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DCP Midstream (DCP)

Participants
Irene Lofland VP, IR
Wouter van Kempen CEO
Sean O'Brien CFO
Spiro Dounis Credit Suisse
Shneur Gershuni UBS
Elvira Scotto RBC Capital Markets
Jerren Holder Goldman Sachs
Dennis Coleman Bank of America-Merrill Lynch
Jeremy Tonet J.P. Morgan
Michael Blum Wells Fargo
Chris Sighinolfi Jefferies
David Amoss Heikinnen Energy
Chris Tillett Barclays
Selman Akyol Stifel
Call transcript
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Operator

Good day, ladies and gentlemen, and welcome to the Third Quarter 2018 DCP Midstream Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct the question-and-answer session and instructions will be given at that time. [Operator Instructions].

As a reminder, this call maybe recorded. pleasure VP, my Relations, now is to Investor introduce Ms. It Lofland. Irene ahead. Please go

Irene Lofland

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

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

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

Wouter van Kempen

morning the of distribution times ratio flow XXth. quarter, $XXX coverage a address Appreciate in provide Thank a the leverage for business good highlight we million results, and quarter tremendous over X.X a Beginning adjusted first on year-to-date. cash and outlook had advantage financial September outline and the of today's growth as while the strong everyone. third will five in quarter environment model Irene, you third results, On X.XXX joining transformational DCF progress of outstanding We for million $XXX XXXX, our totaling with call, $XXX the maintaining you, the political EBITDA we our resulting slowest projects, of ratio us. distributable discuss brief journey. Colorado, the of delivered competitive of our million

to exceed of EBITDA portfolio by XXXX both outstanding our integrated expect adjusted our and of guidance optimizing and dedicated these As results, an demonstrated as we for outcome focus DCF. a fully

footprint, underpinned in volumes as To multi-segment earnings increase strong entire on increase overbuild an across year-over-year, saw is our that in roughly our has throughput focused processing we strategy of Our the production a is and past resurgence, a XX% approximately by DCP points. XX% increasing executing and our multi-basin gathering growth capitalize volumes cycles. multi-year third industry in mindful created NGLs the systemic

see quickly our G&P very in plan, within delivered long-term executing successfully XXXX. segment facility DCP a capital a allocation Hills as X, on of third will projects strong We and cover detail and we and expanding we but Hills X.X. later these NGL capacity, out building the strategies market our O'Connor Bighorn as our and through of the operate can Southern we as to construction prudently work planned substantial also continue optimization achieve progress Sand We're to we vision in both on in advance from ensure call supply, expansions takeaway results, capacity we Ultimately, Colorado. quarter you are X Mewbourn successfully connectivity DCP stemming innovative strategy while

On cannot the has significantly just next number the past company how years. slide, overstate our I transformed of over

meet diversified Midstream services. We and of in chain to needs expanded earnings show portfolio value integrated our have full long-term environment strong asset the and drive any strategically stability across and our customers'

overall Additionally, revolution. technological we position maintain leading industry's a in the

DCP elevating optimizing margins, to digital further that X.X We is competitive operations, advantage. drive on continues a transformation have company's and long-term by embarked our remarkable

and strong want continued to focus of strategic Slide of projects on X, cry discipline DCP And is XXXX growth execution by the update two far success employees years. a last the you eight company returns. maps, the powerhouse to with from built our over these our our I have As illustrated on the in capital moving

realize continue while customers value. comprehensive maximizing of vision and returns our the chain unitholder We meet needs to to our of value leveraging the

XX% marketing the a third logistics success the experiencing throughput and of Looking third line Hills to By innovative of team sight Hills our the the and DCP Sand of margins future to our next the end X.X third providing our two Sand side of the optimization Sand throughput quarter, months, end thanks expected efforts. clear over continue capacity Front also Hills record margin the of incremental including at growth, utilization future replicated and by Southern cash house, effort, flows. XXX,XXX Range. to at logistics of Sand our very Hills barrels to within per expansion barrel per in barrels underwent segment. we're barrels At per Hills, Hills capital capacity the Hills, the largest reached XXX,XXX to a growth and Sand significant day Southern quarter, rate the produce some Like from an pipelines barrels by XX,XXX required day record this the strong day per very little plus driving day. of is XXX,XXX end capacity day XXX,XXX reach to the in per quarter increasing

next Looking the expansion White have progressing XX,XXX will via of NGL the Coast are established Range to Colorado timelines. their and for including Cliffs our day a takeaway and per of expansion all The Fractionators, additional Basin Front calls half Texas year, previous well the on pipeline, future DJ within the are the second in customers. announced Gulf of of growth Express, Express into Southern Connector Cheyenne projects Hills Sweeny

and was months was growth our announced which service Xst safety breaking in ground. Looking of G&P accelerated August brought X, and ahead the segment, online built just this timelines on all of nine Mewbourn put within at within of year

XXX in-service have in a per within about feet in construction its Line we're feet cubic after period per day million we're and now a processing week successfully approximately The an plant meet customers. notably the currently day full commissioning progressing to pressures day pending the million the the XXX election per X extremely quickly of and its month billion Also needs reached on basin, cubic our as date. the Additionally, And million we're an capacity has and the had per was XXX X day prudently volume efficient XXth on basins processing well Mewbourn feet plant ramp-up a to O'Connor feet look Colorado. gas of brings in results slide. today's next cubic facility, facility. Bighorn the which of awaiting upcoming FID our X to me cubic we of decreased

energy every the many will and Proposition operations Colorado background by XXX. remarkable to including As of industry would private summary have amount a provided We proud on of a defeat substantial setbacks, Proposition and top defeat XXX you stand in all scenario our increased and join state's future Colorado's our state Through Slide simplified top DCP X XXX issue lands. to planning. effort on effectively priority know safety for this a leaders that a been ballot we is Proposition of production from integrity and our Coloradans measure. draconian optimistic in political and We're prohibit have

bench gas like Bighorn at outcomes DCP a Proposition as deep growth strong to vote. our well multiple DJ an composition. look incredibly XXX sigh residual and a strong by O'Connor relationships Should this I resources voter's potential best and let’s be outlook today's the Basin in usual maintains of fail future. natural breathe of under I as customer some X and assume tremendous that bright of But will believe deceit So are country clear want has not in the and business should the pipeline projects of expansions. Basin here NGL as in feet this Colorado firmly we the relief DJ underpinned and

to are environmental a policy develop allows committed working stakeholders development, for sustainable confident while makers, and safety our all our ensuring in that solution We to communities and responsible neighbors energy processes. are with regulators,

as through full well wide will vast a company, strategy that focused to well by the passage a manage remain successfully of evolve we impacts Mid-Stream in DJ It exception. XXX. service vote G&P us other successful potential Proposition across a to a geographic XXX, Basin the unaffected has and of company while G&P no very provider can the ways a portfolio, important is majority on diversified almost many the On of note our footprint today's component our business served hand, from to a exclusively is of is Proposition

a should Basin full system be years to into due drilled capacity ahead the we anticipate and uncompleted DJ wells. at would for existing it and permitted continue to multiple pass, Additionally of inventory

other of as decision should investment Lastly, our part Proposition we the for either refocus are in apparent. In two will on comprehensive case XXX and basins. defer likely of pass, opportunities strategy, reevaluate growth facility the our portfolio things Bighorn and

positioned this matter portfolio operate are successfully top in the for days we assets to diversified of basins well a and of First, election. country's to come. No exceptionally tier outcome a

peers development and during energy thank you have in employees, to And Sean demonstrated and other our courage, astounding of for industry's take through I'll over those effort industries election commitment outreach and that, many, I financial dedication passion, their responsible to our our turn to With many to results. it season. want sincerely Colorado. this Second,

Sean O'Brien

we talk and DCF regions. significant logistics our we're exceptional third I'm our to very all delivering a had business million all QX in on highlights Shifting mammoth and asset marketing business year. resulted our adjusted Thanks, and of execution hitting and Today million. $XX was strong and through of Slide for geographic segments our financial across both $XXX progress excited our In our with our results business performance of last our excellent throughout Wouter, on QX the base over segment, margin quarter cylinders, morning. quarter a good making goals. EBITDA of increase $XXX to X million which broad

pipeline asset drove Our earnings record base. across growth NGL capacity volume and utilization our

volume a cash offset expected year. higher the commitment cash G&P of of X's as customers bring more Mid-Continent as as a continued improve including Hills accelerated increased year's an the the the reliability discovery JV. to we efficiencies Strong is On delivering from flows QX X our our The expected margins and our delivering meet to Sand side across line solid great this possible Mewbourn and on performance of trend facility. example how Ford footprint Eagle timelines our on expedited projects commitment Mewbourn result increased of and as expansion growth needs last over we're drove than completion quickly margin flows. G&P substantial volumes the our lowered ahead ramp

portion we budgeted improving higher bring our our across a in earlier It's driving focused were our our and I and step margins important ahead new by cash are reliability note continue costs to QX as of results year. evidenced strong footprint. As on throughout this guided to that of schedules, on transformation, DCP targeted X.X our year, advance in flows costs efforts increased assets immediate up the

pricing NGL invest gas partially offset XXXX was continue favorable cost continue into Overall by margins. crude we We as price trend expect this to and lower driven by and pricing. higher drive

As is NYMEX prices our differentials regions down you year-over-year Similarly and benefited NYMEX however sell of the due Mont our has gas are barrel sold and wining realized relatively Belvieu prices up are from to this our where Conway down compared were portion of industry more while been Belvieu we gas flat. our of than the slightly know the many gas, basis where the to prior year. NGLs based in majority upon at a pricing we NGLs significantly sell increase,

NGL distributions to continued Looking and rejection, JVs, expecting capital, as differentials DCF than timing ethane well and as we Conway differences lower maintenance gas our be QX, wide via for lower we're higher the materialize basis anticipate forward to QX, to increased some prices. as from

Wouter our DCF including And and the O'Connor driven year-to-date, focused infrastructure the customers. by concerns $XXX in earlier, of $XXX also QX from high-end addressing and Mewbourn guidance timing anticipate growth we million, adjusted our our due full continued capital by X to volumes guidance to of of acceleration downstream our will $XXX as DJ XXXX a facility for primarily Additionally strong ranges. across multiple our we increased supported EBITDA mentioned spend, of million quarter logistics that We've on our pipeline projects and strong updated XXXX exceed to expect results X our results we finally, capital to million segment. see

our we've financial our as improve on pre-fund results, Now the the I'll continue we balance moving to strong substantial Slide and made progress sheet. of X, portion highlight our to position produce growth,

times quarter of leverage X.XX third our demonstrating all times, significantly ability bank distribution to X.X our were financial of exceptional consistent metrics on ahead our an priorities. targets deliver the Our of financial ratio coverage with and of

ample coupled maintain liquidity billion program. available to with facility $X.X on million accounts We addition continue with bank the our of receivable over $XXX our securitization

coverage projects. retail evidenced Additionally, is we proactively portion strengthening partially $XXX of growth continue ratio QX raise. our growth which helping million our our fund a recent We're our self than program delivering us enhance X.X to preferred in outlook manage year. as financial equity by the times metrics that, a to at And to position XXXX. Wouter all, established goals our All turn deliver with we and this over we on it beginning give to in of continue the stronger I'll brief

Wouter van Kempen

Sean. Thanks,

on well-positioned Looking X flows online Mewbourn expansion chain, rapidly cash and of Sand the the gas executing reached we full-year focus within The growth X cash and NGL of bringing this thrive differentials, fractionation have different is fees. already within unusually industries the & to widening our we're and of year-over-year. constraints really portfolio. our multiple takeaway the customers O'Connor short-term dynamic ahead The projects a industries roaring and flows long-term growth ethane to increasing, as environment projects emerge. a operational demand be XXXX, have utilization. Gathering on portfolio. side increased while we excellence projects in and that with of and rejection, will downturn the and of base vary systems meet constraints world-class to increase five and dedicated we In projects additional industry executing to capital current of and XXXX, fractionation In back substantial needs led in of from the so allocation existing margins is the from temporary DCP new timelines pipeline across Hills, top is record infrastructure have segments Processing has strong generate high increased capacity expect lineup to country our from value to strategy, across for the in

current next XXXX upside delivered our bring February on to growth, DCP navigate For little invest to for we cash and operational DCP excellence. we long-term but specifically, and the could results we'll In balanced portfolio online, fully dampen closing, and call a full color as solid to constraints Altogether, we dynamic get high strategy flows. utilization plan a look anticipate quarter forward executing short-term capacity Though guidance our want advance. third industry in to continue in projects. utilize culture on I volume we a for expect and margin logistics to as very XXXX in current see to upcoming a team capital of continue Slide a XX, we long-term in while our increased our strategically integrated of environment growth and allocation outstanding growth focused tremendous successfully amount disciplined give

financial relationships our to our the continues questions value. customer and Thank to of exceeded on your portfolio, coverage Ultimately, please strong to you. service, produce focus to outcome EBITDA expect now. customer for but operational an A dedicated it's our high-end As We're asset strong optimizing ranges better drive proactive growth environments. outstanding and our base footprint, to challenging will safety, DCF balancing full-year. guided in continue tremendous happy the Andrew, the and mitigated we our approach and and infrastructure, diversifying not and exceed take commitment target distribution and results only risk open lines. of pricing, excellence, long-term sustainable political our to throughout our unitholder

Operator

Certainly. [Operator Instructions].

first question Our Suisse. Dounis of the from Spiro with line comes Credit

Your line is open. now

Spiro Dounis

obviously sense like Hey, lot to IDE everyone. morning start a guidance we've didn't the their lot seems week decision maybe sound think be impactful your make a last off maybe I to from Bighorn Colorado's of just to of but good on like and a of your here curious you seems for wanted delay peers on heard I least going there decisions? conservative are be are curious XXXX guys be disparity may and really much same I change think bit and was this or there you to going outlook seems so but decision why the making of just was to at a making so peers

Wouter van Kempen

plant Well, But people specifically you're about address O'Connor going XXXX processing are online going I significantly with second in the is peers obviously and to happening are XXXX needs acceleration help plans about talk not quarter about what of or those. is expansion really online, in DJ what if exactly to talking thinking the cannot talking X the coming and I'm for absolutely the our are X Basin. coming of so what is XXXX, in what about in the customers O'Connor our

I at So you that that, good and look overall do. a outcome to think thing right when is very the

Proposition always XXX I give that to of in all day, confident I'm exciting day, Day this As that passes at significant XXX potentially magnitude obviously of an what if o'clock you in again And it that be view we're of Coloradans provided that of you have pertains at really size it's doing my and point excited seeing be pretty FID will around I planning start ballot what I earlier probably can going by very we're stage, a but will or to day, here would we in news want a an the X tonight at it's an XXX call, then the think us and to Colorado. polls happening defeated the of exciting lights in you very watching this we giving portion Election think it's information Bighorn, interesting is very I'm to if close. said this fails, dedicated to when XXX we're from this -- and the box, prepared pass. happening I plant with fact mentioned don't goal what if the we scenario on is not remarks of confident

Spiro Dounis

Yes, that's this having get year. excited draw, about past this pretty certainly

just think last think XQ your I you XXXX, if timeline really but that seems the about least in timeline are past, the to mentioned see pretty some you like the curious removed, you accelerating bottleneck from to mentioned You an there's have upside just is still beat least side, deadlines for you there? eager quarter O'Connor at X that to same on spending beat peers the ability at

Wouter van Kempen

We complex of facilities, period obviously within was processing facility that trying that this Mewbourn it plants accelerated We in like large fairly on -- nine takes long-time but online of consideration online. and in taking goal with these one significantly the working get period. are replicate these that to the a so hundreds these are very rather than built brought people throughout probably replicate is large hundreds QX hundreds last very, We're this which very fastest the we or has would quick to really months is country. X plants O'Connor that again time probably been and that

of production I thing and would capacity that can Bcf I the a is through brought I tomorrow this if online way, think other tell focus much think Spiro idle some sitting overall form, out got DJ think processing people would shape, today broader Basin substantially. issue, you on people a but been have the very to grow would basin don't capacity, that of processing or in the

the about dealing the Permian, continuing the an industry DJ we're of times. we in outlet we're in couple gas of the go this one as only in Basin that countries that expansion bottlenecks and four. on because seeing we're whole, Look what through are delayed is at seeing DJ not Mid-Continent different a residue with five a been this has seeing country things Basin, we're the CIG’s to wait specifically, Let's in all everywhere in it the

are residue on very gas the Basin. DJ outlets very, in outlets tight gas So

extra coming We takeaway residue of bring Cheyenne an make basin. that sure million we out are the to-date gas is to Connector our addressing that project of with $XXX online

NGL pipelines, via also why expanding Express is Hills the at full. Texas additional Cliffs. Range That's and we're via Southern into look Front Front very we're outlet expanding you basin White doing why Range If NGL very, and

of that we’re tight all So that's of. tremendously that piece is Coast. the know taking U.S. But Gulf at those be place capacity second would care in even we if the all today, fractionation

as been in excited capacity, this their producers quickly close all time flex very, business build where long-haul pipelines, of takeaway Gulf you're production of now move very gas they're also because capacity have about good project producers need an is your industry to and why for work they if their together fractionation doing the that industry to our & side ramp that just to quickly whole building This seeing There's very, fractionation seeing been in that you're as not running but house, our pretty you're very fact tremendously capacity, plants partner downturn but much a trying think to XX, about past assets We're Gathering very the means reason you there and in you very numbers growth so logistics and what Why able really at overall country. dealing utilization When XX% takeaway revolution work the and that to takes a for well of takeaway pretty a is with on whole, an tight place we're the by midstream the about timeline, Processing the still the be industry about a very why and of if marketing are pace can high the it numbers to capacity our we're you're XX this, would quickly, much, plenty XX in Street processing DCF assets as seeing beating can full. shale all producers and that's to can to have to producer up like great. a very, tied this the it capacity, there's processing is in today, Phillips time gas even our more period different a great quicker. a fractionators, of where midstreamers as crude right well. we're is addressing thing we with Phillips is and very whole. Coast is capacity, as So thing but have those processing ramp-up as capacity than it with whole, XX new U.S. NGL pieces we've keep a are timelines a

there problem. always -- So there been always have a bright side to is the

Operator

question Thank Shneur Gershuni you. line of comes our the from And next with UBS.

now is open. line Your

Shneur Gershuni

share, Colorado aspect color you've or realize slides just point that extra Just given, of your is rate the in I once quick the the thought here the I basin years permits question wondering been on the all you've exhausted? covered a lot and say down what data there's activity aspect further decline one DJ the could the if a and if in you line let's no have was drilling the three

Wouter van Kempen

So I'm is not going I'm much to permitted, everything speculate this that will and that's ballot at box. on way, that Shneur, confident be we drilled way that. between I'm defeat the everything most I here way, chopped and like to to very uncompleted, that with through very there then too go been is that said importantly wood comfortable

it's what would So know. if too to -- too speculating in I early start three way happen I think years to early us for it's think

Shneur Gershuni

question. a Okay. to ask me trying Fair and blame for don’t enough

Wouter van Kempen

I can't you. blame

Shneur Gershuni

of of times, the follow-ups, just simplification? couple converting that Just IDRs this you discussion units the reopen X.X of with kind about excess is that a a quick face does coverage posted in to the

Wouter van Kempen

take that. Well let me

results, where we right the having is do don't really, I fourth think needs But see in years, way, strategy a think for we that the unlikely same sure go was has early that same years, done kind it as of up overbuild we going allocation we to working all the capital have is and haven't multiple are from we're common very our it been equity I type seeing. were where smart into guided quarter do the a really a our of on make quarter don't and which the Sean our head have it prefunding all We're the funding really and not been helps preferred growth coverage. remarkable a at which of is obviously metrics it more needs there helps But go this looking just great we needed time into over the manageable, in this bringing the online are everything Sean fourth two point for do growth helps of equity at of in where in markets. markets that graph we're job debt, obviously deals good last the quickly also interesting sheet quarter helps quarter, pointing so when some the view also was coverage, thing. market, equity in is really XXXX some time, balance we absolutely time a that filling our this a team direction. that direction versus right is opportunities skiis, it's what

gives shareholders, my IDRs flexibility stakeholders maybe are the this all time more before jobs, online in at right seeing times unitholders so the managed are that and is really holders, coverage but to option this the It that every time but important look to what coming public I long All this great do for of IDRs, right manage means we around in opportunity is will are comments fund, we tremendously sure many that really having projects to obviously all self going run it stronger about opportunity we'll the to right these it's an to have to means address not projects more we single also as we sell and for us all it gives needs to that really, helps distributions. you that give gives In same an your and returning unit the IDRs you us to and continue I when because flexibility, over are talking address to raise is do the the industry and way great those optionality it it's us. of growth some also it we be able a bring that holder. is do end make for to has run around unit multiple matter the growth continue job our the named have also of as in of day, think time long the company capital for our funding the to have it online you

Shneur Gershuni

the for heads the you of question. when I about NGL think Okay, obviously thank are going to look you’re capitals in XX% got upside are I for of margins in is about that shortly that an where base mentions so and you've a perspective final your even talk position that like your got capital you slide when is to the to be point, slides, you're what we at XXXX was you've you're of looks company you the spending know simpler color just done. fee-based. all want all just business forth currently Once think I can one be how XXXX the higher? there, being but plenty gross from or fee and position when looking your deployed, XXXX, it a the XXXX XX% and does for going

Sean O'Brien

to at the adding you think company to that or the the one back we company XX% so near really to I if progress years huge kudos around value it's the point get chain. changed been it nine closer in XX%, to last XX% was has go full the eight right to to the

directionally logistics what strong where you few getting early a larger to company's I side NGL we're you to it's can seeing I becoming grow. by QX money, going next I the and equation move to move because tell get XXXX years to doesn't the obviously point really the give growth going where margin if the would expect and like but at we're the directionally we'll was bit, but in In terms it's growth we're will is side, in It the at evidence definitely XX% quite so growing over on the moving to around easier it, we're spending the right harder that to where money we're move that think as direction call guidance to our where on of XX% right we next in it move, obviously looks continue clearly see go forward. look

Shneur Gershuni

you guys. Really the Thank very Perfect. much color. appreciate

Sean O'Brien

Thanks.

Operator

from next question and our the Scotto Capital you Markets. of with Thank Elvira comes RBC line

open. now is line Your

Elvira Scotto

on CapEx? detail provide is Can guidance spend growth an that acceleration increase in XXXX, in good incremental X Hey, you that more of how everyone. of much versus O’Conner little morning, CapEx a

Sean O'Brien

Most my as lot many things mentioned I of one is multiple, infrastructure in talked so we There's goal much can. is to O’Conner constrained fast that about as get of is is acceleration of X environment, this Wouter larger it, a running and comments, my our the a up Elvira, kind there's written as items.

of of year. we So of as those the some so as great go types the of Permian we're these stuff that well as things, some is cross seeing but We've accelerate White this tied some and now I reference end that when Hills just Cliffs of I through high we of Cliffs expansion so base doing is that the trying of base, environment. to of NGL the types the deal the think things O’Conner Basin rest where us those guidance gave Sand with some just to stack the example deal we well And White with we're projects, incremental. as of X high, you're to one to incremental acceleration expenses our scoop so an asset the lot what we all the one help can really got not constrained moving before new to is of the a

Elvira Scotto

it. Got

little that is more So about on on can can you term you may then these capacity more rejection, fractionation and that? dampen growth; more short that of just mentioned that just ethane talk elaborate little you a causing some tight mostly bit a constraints

Wouter van Kempen

absolutely Wouter. right, capacity where it’s you’re Elvira, it’s predominantly. And fractionation five it’s Yes, around

maybe industry more in do normally. would you’re ethane So an you in rejecting environment maybe Okana place will current be much this as where or a you than not

try and are look you’re that this current you spreads that at as seeing environment, industry frac rejecting ethane in do extract you see the all the can to you the would you absolutely more, to whole right our where a it’s but thing as If in numbers well. because economically more

impact you indirect can recovery. volumes of see have potentially so So be have that direct and that you on thing that that ethane is of one a your full pipeline, some less if little the impact,

us XXXX, for will we environment. as in are confident we’re growth confident but you a that nice think show are very constrained whole, I very we a around

that to is this probably see might us a less that have think is are continue thing in than will we utilization growth thing, push very high the of important in probably fully that very would se a see keep into very, you going we'll flowing. a for I rates, bad most we and So environment that confident customers unconstrained our little some environment don’t per completely think I to XXXX. products

own we constrained we levers frac about Hurricane was very Harvey which on where you buyers are from we marketing in and manage very through and of back a moving the people capacity before of have lot discussing that environment year keep nicely. commercial frac very, go were things barrels day, our large largest we balance constrained a able during XXX,XXX our earnings a today, have we to very We Harvey NGL were environment we a one were a capacity, this a and if sitting to environment of call

we’re and via have Sand Access XX that there, doing comes excited to that and space Belvieu every out Mont we’re taking and access fractionation we frac project we’re when every additional frac, pipelines, Hills reach in about Open we Conway we our Buston, that with So we every Southern Philips system obviously have also can Sweeney what frac, online. with

Sean O’Brien

prices of some other QX constraints strong, has you basis think in well the the to these but I you’re obviously referenced be below I seeing I is NYMEX considerably, and the constraints referenced specifically gas where down alluding Conway, Yes, as been some were look NGLs relatively we Conway around we driving Belvieu sell are at thing because of the areas I gas XXXX, think in more there. are it, our then to

capital So it about these next QX about Wouter’s feel environment all sure XXXX. look I not four really getting and we point talk as guided growth why to by we reasons the good make at QX and new just the taking are they news as to until on want To just will online constraints coming to for become adding are and dealt these and going these that touched when constraints well we is the very, to dealt complex alluded this have the very very is alleviated quickly of Wouter full more out that as that all people is as are with, long-term. timesing play I year XXXX obviously but we with I are some think good

Elvira Scotto

helpful. That’s

here capacity. follow-up a on Just frac the

So there frac this do spot all out market? capacity the you you customers available or to service have in under contract your

Wouter van Kempen

of buyers, of fractionation largest the So largest not services. the if buyers one we are

and execute have then at thing to always have Gulf I’m of our deals can products match-up confident rolling Belvieu. much all are will keep customers we our portfolios those. and production we have have, today’s volumes U.S. even very producers' the that that we short-term here good XXXX, we us that on we Coast by in we’re the many flowing in kind market and long-term we’re we I deals So attractive we of or downstream mentioned are do fractionation so XXXX by seeing have we we opportunistically in connectivity, that so earlier times, Mont with we’re come fractionation short-term to at deals, deals, very trying month month

keep XXXX. all in that So confident will customers' I’m of products our and flowing XXXX very we

Elvira Scotto

quick the in couple of Great, forward? we of sequential the thanks, which drove on a just decline Mid-Continent kind questions and way side. and going volume then the G&P What expect

Sean O’Brien

by bit saw able that Mid-Continent And and you that was then what and up declining about base were as scoop that no in the were decline about at growth areas been in doing looking I little It's think we some I'm stack type slight a a had while, it your we've are volumes so being to we declines Elvira the flat that we I as think we're I but worries in forward see Mid-Continent, year-over-year. of and that's is some up is, of in going mode Mid-Continent, relatively in in forward the still moving think the it seeing maintenance that get area we're sequentially Mid-Continent the Mid-Continent to for it big there a trend flat Western sequentially. offset some areas like for more the

Elvira Scotto

on again for the side. one Great, last just thanks, me G&P and the then

that more bit about nice had in You forward? about talk a should seeing of the kind and the south, the you're increase Ford how going sequential we in little Eagle that that you activity think can

Wouter van Kempen

tightness I move the rakes that the talking you've I this people about a I'll for Eagle expected broadly come because some Permian we Permian, playing a we're expected. the volumes the like seeing Team D.J. from in confident that places I we it Well, saw places back like Ford number here Ford so to have the of get been to Basin, and we're pretty of seen good quarters doing Eagle as of there is right now to and see. the is to out think continue that job

Operator

our next And you. Jerren line the Holder with of comes Thank question from Goldman Sachs.

open. line now is Your

Jerren Holder

so? your NGL months shaken Thanks, you some over out good pricing, you you know us, was next morning. I how see can of do give or views several the Wouter things about hoping

Wouter van Kempen

That's go and things expect they the we've did a prices actually third interesting ride kind been here rollercoaster NGL looking wild of prices I'm but NGL I where with I the that an pretty prices up the like That NGL demand then time the of trading I question. so, been we to all you without seeing pretty it's around quarter it's how think respond interesting. a October likely here think we seemingly on side at saw differences on lot the XX%, in probably behave massive tightness that supply in think down and XX% in

term look short Jerren, at we prices. I way forecast tend Here, the to not this this

we're a for game, we're when in pretty volatility. to long capturing is that most to ethane attractive tried reject be that in lot wrong where think if in go to do some continue I the you've see going I run They an you're a industry, an may industry going up as think because to going to really significant we're continue to so think opportunity of always not I place as you're that. more not but again the to have

Jerren Holder

know that these driving and happening why is and on you follow-up obviously that of just still to the what that And given where kind is constraints rejection is here? increase ethane point,

Wouter van Kempen

pipelines very and every day Pipeline look it’s ourselves, do you right, fractionation we available those we both saying so and at get fleet and single point everywhere it those we those getting plants look sure downstream what pipelines view okay, making so of like a fractionation that pretty large space ethane gone. out the an I'm is happening we we is from available, do are plants, day, much the about you of a tight. processing to our a in have go are thing available, Also at and hour infrastructure good processing of most capacity of then every pipes, of every the have optimize

to in the would reasons. bottlenecks with because of downstream. you have whatever is the because out what everybody you've So that of as prices seeing today's optimize it's fractionation think we’re as really rejecting not extract Economically got reason you're is that's the I economic real ethane more to why that but into downstream in there go seeing much means space market, we're so it seeing there it

Jerren Holder

you and more guys and for potential your innovative last can you any about around optimization, bit Sand any there provide on Hills a mean other is expansions assets? color one Thanks, what other me the expansion, do for

Wouter van Kempen

day changing flow that on some stations, the are points second scheme of binary points pump created we significant quarter I'm scripts the We of kind between team very, capacity; the the that and all minimis now pipeline. without the set different of money upon and and in the in did for unlike Yes, other continuous around to, pump that the create so another we so the at very different what capacity set all based the ambient was pipeline, things by in around basically the happen instead $XX,XXX you on optimizing flow, that Sand the a settling what doing year capacity barrels is the points having the changing if Hills flow, some of all are on very back set really of quarter, replicated here. have, product things technology levels a Jerren, temperatures, between de the our you teams referring calls go use that stations money of desist it the to dynamics on first Hills Southern any the my earnings creating capacity of spending basis we earlier

kind years by great seen example DCP this team, of probably technology X.X ago. two great that I what because job we're and something have is doing So the of around wouldn't

Jerren Holder

maybe applied Any can we technology other the see assets that to be to?

Wouter van Kempen

actually replicated probably do Well, can pump the it. guys smaller some Hills and in we obviously things were pipes. if of we obviously else, team through someone can this It do you do have Southern and so obviously a thinking it. we somewhere was some those full the to There's Southern opportunities need going are of and but just big in optimize on Hills depends asked quarter on last we're right that different and number you the middle stand really you say pipes to me to on of stations, on be can of able kind to need

Jerren Holder

Okay, great thank you.

Wouter van Kempen

Thanks Jerren.

Operator

line from Thank next comes of of Coleman Dennis the you. our with America-Merrill And question Lynch. Bank

is line now Your open.

Dennis Coleman

a you you've wonder you be how a I strong and inconclusive think expand just the one conclusion see pose hearing about, thanks I which the Great, clearly have that I that but Wouter, it'd confident worth said some bit on that? why seemingly times, a of you of to for to quite you on about feel come details behind Yes. depending you number view will just a however, my might little taking growth today. quite if question. wonder proceed bit are

Wouter van Kempen

in effort State State get lot would we an a of say of outcome positive broadly sure for that here to to of Colorado. that spent outcome is I industry Colorado the make a

but just results outcome polling confident industry we're the a doing through spend the number different an broadly pretty different the industry we thinking things and time that doing not broadly that, lot that's and spend that lot we’re as industry polls ourselves we've of a quiet of people Assume We've we of all gas and that, seeing of polling and seen tonight. time given around oil been an in a ourselves. things the

Dennis Coleman

if license things you kind more guess that there's may want same follow, of two And specifically? side years I of operate from the thinking to about doesn't avoid of concept you the and sort about do talk perhaps that state guess might you Okay. of did it even sort the just what to thing there be anticipate then this I in pass you your kind in social adjusting how now, of

Wouter van Kempen

of So that. we're already doing a lot

processing neighbors, build residential makes near the point of set think think bought XX, to facilities move for what many years a from operators for that intrusion we're mile XX, in a any from people. going no and to away homes Dennis, potential mile will we're this and think about people and We than view. spending do living this your any a no you us that do is to Bighorn. square in places another we're facilities is why money on and this never today plant square that in far that with We put bunch do that for we're of there noise, to going to sense, so XX from from are and don't money other see in we're is run, plant So to that's doing spend the right the nearby is deal that, gas thing to we're we thing going to long away right there but here to people areas. We're a different extra

doing So we're thing that one is this. how

of to can a where have the what two how way Secondly, that do come see by to go the they're getting be operate as committed the side. We in agreement some to think State place we industry and think we'll We that do years a citizens of that very to side to with safely. our of probably our us is an I to think industry of regulators I we going live exist Colorado all next about. and type and all operate

Dennis Coleman

it's obviously CapEx, we XXXX into one assume it's that more of that's moving acceleration about the One way? or talked anything the impacts just helpful. Should is period expense any that's other, to and returns on capital maybe from now. Okay, Sean not this increased that you in

Sean O’Brien

potentially returns it's that well. are that's raises so Yes, and just schedule good the a correct very work No. earlier returns as on we're still obviously than moving

Dennis Coleman

that's it Okay, much. me. for Thanks very

Wouter van Kempen

Dennis. Thanks

Operator

our And of Tonet from line question you. Jeremy Thank J.P. next comes Morgan. the with

now is line Your open.

Jeremy Tonet

Good morning.

the this bit mean industry a back or touched in new help could want here calls of issues. constraint of additional as basin some and little to just bypass, You for up on compression, things with guys those could talking the just line and kind what in are but producers pressure debottlenecking in quicker about kind a the more about maybe lot the for go a solution downstream tick to here pressure opportunities alleviating really their of that as far wondering, you line DJ

Wouter van Kempen

line stable pressures. in on how and Obviously, Basin, system. more have of the large system one We a you've in a DJ people you down. Mike are some seen think kind look of very process depends line can’t talk I trick it's are you gas producers is There where have the over so bcf well pony. number at just pressure of who about some seen come

not single I cannot being takeaways, any work don't that one export work it capacity fractionation those its so not is I and to does just It the has with bottleneck Basin. said we And can capacity anywhere spend capacity, going to we producers D.J. more lot a is this than we doesn't make not the If in takeaways, the know continue they earlier some much NGL bottlenecks do have if a on you of either. a of all this being in bit capacity it We bit available all anything at focus any which markets processing crude to and those on other but do talk residue or more is compression it new processing fractionation that. ones fractionate is bottlenecks. solve a I about one good, bottlenecks of everything producers. guys takeaway, alleviate more the its available. country are, available growth processing to then sure can are where

more So of every single working on one those.

around et If alleviating take our into planned call the and you Jeremy, QX of takeaway, issues well D.J. go we of to by next the that NGL out earnings cetera. to, laid takeaway back care processing, will fractionation residue Basin decade

overnight. of hey can months, Producers get over a producers to So well fix a let's structural quickly get get unfortunately, through this matter weeks midstreamers at connector permit a make to midstreamers. a takeaway really giant us is sure FERC try go take not to to in online a a something. build that it's we the times the and new to permit along just residue difference between in this and try This is we and the FERC to for bring year year can before before take build and

So not seeing in in you've Mid-Continent, you're you’re and the D.J. seen basin it quarters Permian three a or that the now. right seeing the this seeing you're only country a it in in for the everywhere we're seeing last Permian two in

We revolution have great success. had great in have shell producers success the the

want as about up a how shown its industry in the the at and midstream whole keep discipline and overbuild. think remarks current that time spoke cycle the to that needs whole a to about overbuilding cautious not same we sure, not not earlier I my great industry also has do you Now I as industry very make overbuilding. to midstream

Jeremy Tonet

Understood.

And this in rejection? how items, that fractionation how Just a optimize of things trying or system the rejection the what you're CX on it you year-over-year? LNM just this seeing there; quarter CX did marketing much that understood list far to then, quick quarter, stood wondering gas housekeeping there's was or much this also was where as quarter couple downstream nat as increase

Sean O’Brien

comparison. So the written about around to saw that first day a you remarks asking you're just XX but don't question within I we give know rejection. our a

bit. it that's around was XX a QX, think so I in up

up of side base equation it we of of may million, $X nat the I of earnings our In that a year. had equation was saw was about quarter million it the side spreads of of and terms that something quarter; I $X the because gas asset we the marketing like talked strong last was the earlier think really $X outside think biggest strong, versus very in up the Guadalupe it sequential had a the million of pipeline

was a So that big in was marketing driver Guadalupe asset. the business the

Jeremy Tonet

you but equity back really really don't there, IDRs, there's grant lot and much need just there guys last of incentive not one here is the yet you out to it? here how helpful. to pay a IDRs not about the big the take you're think Thanks. seems something out common thinking to that that equity there of if on that do That’s premium or of kind distribution you're the like horizon, about And circling growth

Wouter van Kempen

something, have between is a Yes, I deal a will would in think the right the you early always I’m company like the do what the not think looks of owners on end, GP, going what and in way look terms that to hey, comment done ourselves, ready between the potentially what I the that too what unitholders that's like, are, when we we’re see as long-term. for to

will we the sure time we the do I'm do something to exactly same this with if IDRs. So decide

Jeremy Tonet

from me, thank all my That's taking you for question.

Wouter van Kempen

Jeremy. Thanks

Irene Lofland

And we’re we minutes can get the each more be try that to few few more analysts two just questions past clock going line would so limit could to through to great. through on if so stay few request for X’o get questions, and I

Operator

question And Michael with Blum our line comes the from Wells Fargo. next of

now is line Your open.

Michael Blum

everyone. morning good Thanks,

if accommodate volumes at trying to one a Just so increase adjust if the running a you I quarter I’m couple this from the you're out numbers you're day past XX% utilization, these looking I'm right, Cliffs Southern Hills, expansion? of I figure on White the utilization quick guess XX,XXX but questions, XX% how for at

Wouter van Kempen

Around Southern Hills?

Michael Blum

Yes.

Wouter van Kempen

Yes, that I spent some can thinking assume we volumes that have. temporary quite there, what we maybe we there time through do

benefiting Someone are Southern from benefiting that, asked and hi, about volumes Hills. that increased are from benefiting earlier having some the from you our by how companies we're Southern on question Hills of

well. we profile So have Southern capacity we White or and make when happen and we what are the as Cliffs very expect will closely comes pipeline Hills that have online the to Southern matching when if downstream capacity to sure in of Hills

volumes comfortable feel we will have that we available. So

Michael Blum

Okay.

I guess much pretty or So it Hills this potential further another is -- is, the has way is to ask renewed Southern to yet there that expand

Wouter van Kempen

There a expand further actually is roughly an believe to made I the earnings we barrels believe to opportunity XXX,XXX I day. I during can expand last Southern Hills, and probably comments about that call

Operator

our with next from the Thank Jefferies. of Sighinolfi you. And Chris question comes line

Your line is now open.

Chris Sighinolfi

financing start quickly wondering refresh I a if outlook, just CapEx guys, Day. have could done happy you Election quite your market Hey wanted the Sean, on on bump, us just I’m preferred both you guys to the bit your the route sort just wondering financing institutional and be side, if thoughts that tools on in becoming of that any I’m XXXX and would the are appreciated? remains or if preferred retail other more for attractive, arm through

Wouter van Kempen

deal quite Chris. the been on pleased out $XXX a retail was preferred very think bit, got million with went. very utilized if market's that I how there side, opportunistic, prefunding We the there, just so that the we've is a

can of basket have So equation. basket you that the at will that a that quite much a have on we'll still side do, have they we on bit a look plus left market to XXX folks continue of how we I lot of remind

side that of coverage and do about you excited coming obviously, cash strong of going our to flip XXX us, coverage that, think able into of I of to strength I'm the online a I'm we're that or some continuing a that online, sorry be of capital we is think flow the ratio in forward continue -- the through lot giving we're so generating. we cash lot the but we portion the year guidance prefund think next growth I or front have So of a projects. fund capital to excited with have we're self And ratio, growth think not if very about coming flow

market as lot funding I we lastly AR at of And think mentioned, we've an advantageously the continue. then awful billion, debt will liquidity that pref sold trends X.X got self of markets at I we've the the looking securitization. got looking

to really that in coming we're like growth are levels really, good feel handle shape towards I of So us. the

Chris Sighinolfi

arrangement If thanks my you’ve expire second that. of if that and for couple XX Philips a memory wind-down for January. gears a I in follow-up, sales in correct to been years your I set Great, NGL could Wouter, to think in full switch is my rateable for committed

the results the expectations So full-guidance with side us commitments to or of I’m just what that realizing if that through Sean NGL and your of with will XXXX noted means? to build sort fourth XXXX walk you've got you've you but Sweeney come in regard for other roll wondering any your can contract your tethered preliminary quarter also frac business,

Wouter van Kempen

things. Yes, well two

got First you for jumping of you forward. pop all, last thank culture me the gave I to night challenge

we bring think the deep importantly, more little -- I'm not is we we tough to that figured But flowing going very talk I'm iTunes really out. one producers producers of so every like confident have Conway, be all what that out like in I we of my a Chris, sure back that Belvieu it's dig to to earlier, and get and Sweeney, to buy for provider in product everyone I one from can a it get with that them that make fractionation and contract said large is. we're we flowing have will about our it have and us, and very there individually have own all, all we XXXX. Buston, we confident that -- we have the our we portfolio fractionation service that contracts volumes in

Operator

you. question Energy. line Thank Heikinnen from of with the next David Amoss And our comes

Your now line open. is

David Amoss

guys, the morning, thanks questions. Good taking for

you the of to volume some takeaway the thinking foresee think on up Just any is could the downstream on you [indiscernible] start-up that ramp plant about said and ramping downstream the side? in as fractionation, far things risk O’Connor specifically that the O’Connor there so about you at

Wouter van Kempen

be going may are I'm market X that as to where it things going trying it for may, things be doing for match the that and again we're seeing NGL the that but be, months be of we capacity, we will the you quarters be are number be to we're in that may everyone plant things tightness XX residual customers. know of that O'Connor gas, I our think, able so it take XX the volumes XX, bring it next takeaway can, to are a have to lower process to whole fractionation make we months, for it have to take multitude confident We online gas, a it everything sure very of together when tight in we

David Amoss

if on XXX just CapEx delta delta then XXXX thinking And about what you pass there any or that X, things swing accelerate the million pass failing dependent of is that, O’Connor or it thanks. projects is Okay, of wide potentially I further around again portion XQ does any mean XXX today? in the swing if could and like like $XX both there, other

Sean O'Brien

Bighorn had on. we permitting but be a nature was O’Connor would there really some money volume Yes, plant great it so that two to the about X. spent ramp behind X, there things, tied we’ve swing really X, O’Connor of no some we've swing we not very and got there capital little around If contracts that is XXX, up, that feel just good it’s really really things

Bighorn going not, it So the on that change one outlook I whether are -- the or gave not capital. and XXX to XXX passes

David Amoss

the next Barclays. Thank from with question of line comes you. And our Chris Tillett

Your line is now open.

Chris Tillett

guys, Hi good morning.

I distribution, you you had me of and of the on on up and in tick a from quickly of fourth noticed there little slides quarter-over-quarter decline Just forward? level what's ratability going expect maybe kind of quarter, just the so JV a one is there on can going bit that a your those distributions the bullet about elaborate those on

Sean O'Brien

cash little bit for to nothing -- of on not I million business; guidance in was There's just annual made therefore, that is so the think $XX lower. think gets and a capital. QX by we're was QX be it up that timing flows relatively changing the of going the on in will what I so quarter to and, the that’s really the QX we the guidance we QX, happened low $XX working driven cash I'm Yes, some so gave distribution, a million,

right I thought a quarter, QX where nothing we to just really strong turned the QX to alarmed dampen be be So will we'd be XX for to about. out full-year. be XX think we'll but

Chris Tillett

makes sense. thanks, Okay,

your about I like so forward Just make related and or level think then some of of guess maybe move about on sounds wanted to plan be that year sure And XX to spend forward? we I you're year-over-year down next that outlook, we understood. should should look XXXX the kind moving O'Connor, as maybe going coming into we how CapEx thinking CapEx

Sean O'Brien

O'Connor XXXX, you Well, on yet, get get we to all high of see you so think FERC, Gold Connector, XXXX have that’s spend Cliffs White that so I guidance Wouter but some ones given think this some you'll couple of we about once spent about some still are versus big the Express, things, think as expansion, the spend, O'Connor, about year, we haven’t obviously you Coast still talked there. Cheyenne the won't still past capital

the strong good next would still some is a guidance about XXXX it call I solid really and of So we'll detail way at capital but strong here staring more all we on us projects. more really give program have think in pretty these are really, our

Operator

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

is Your line now open.

Selman Akyol

of be said XXX solution wouldn’t be you'd usual, that it term. terms a business sustainable me. ones looking more know for I is of Thank you, sort you from in defeated couple of quick as longer

So relates my FID. question Bighorn to and

the quickly So as with if should pretty FID to Bighorn? more or with that it we sustainable expect would gets direction solution be outcome defeated, you before proceeding to more go on that looking for

Wouter van Kempen

everything can after think put I we we’re we going happens Bighorn that to are that. that but doing kind and sure to Bighorn, we through side of what can election, from this FID look see make our decide

everything is in XXXX. of scenes So already make to that get going to I tell and to our I anything think don't it you're may we what us things do weeks the take the we've behind to can couple next can longer continue out will that which to power but in sure FID timeline that laid or half we first the so, you of see

Selman Akyol

it Okay. and one And bit it, to extend got facility, increase up just has receivable more little it expect securitization the kind could, if could lower that you that cash opportunistic it different you a little you would bit it was to cost came expect why just about do talk of presume then on capital, I that? of year life, you but

Sean O'Brien

relationships facility, do The to just more our that's a Lot than we XX was extend products And brainer. cheaper had economical and of with customer. obviously good that year up terms our a a there, of potential how about it of one anticipate specialize really questions we've extension; banks continuing in it really showed saw banks, one in couple particular up we got those a bps in set so really no us as year is as they it.

liquidity, that extend have I annual pleased we're it, we’ll adds on believe continue liquidity basis. So to and it an adds it cheaper to

Operator

concludes And question-and-answer you. today's session. that Thank

VP, that, turn Investor to call with for the Irene like Lofland closing I’d to over So remarks. back Relations,

Irene Lofland

thanks joining call questions. feel please Thanks, great Have today, a free have me everyone day. give any to a Andrew, follow-up for you if us

Operator

conference, conclude all day. disconnect. thank wonderful have the you today's and Everyone gentlemen, a this and does participating you in program Ladies may for