Q2 2023 Enterprise Products Partners LP Earnings Call
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Good day and thank you for standing by. Welcome to the Enterprise Products Partners LP second quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising you to use the phone to answer the question.
Please go ahead. Please go ahead.
Thank you, Norma. Good morning everyone and welcome to the Enterprise Products Conference call today to discuss second quarter earnings. Our speakers today will be Co-Chief Executive Officers of Enterprise's General Partner, Jim Teague and Randy Fowler. Other members of our Senior Management Team are also in attendance for the call. During this call, we will make forward-looking statements within the meaning of Section 21E of the Securities and
management believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Please refer to our latest filings with the SEC for a list of factors that may cause actual results to differ materially from those in the forward-looking statements that were made during the call today. And so with that, I'll turn it over to Jim. Thank you, Randy.
Today we reported adjusted EBITDA $2.2 billion for the second quarter of 23, compared to $2.4 for the second quarter of 22 and $2.3 for the first quarter of 23.
We generated 1.7 billion of DCF, providing 1.6 times coverage. Enterprise retained 639 million of DCF in the second quarter, and we've retained 1.5 billion here today.
We had resilient financial results this year.
despite the impact of lower prices for crude, natural gas, NGOs, and petrochemicals. Our profits were negatively impacted by weaker processing margins for the first part of the year.
Our petrochemical service segment has continued to perform in spite of the low price and lower margin environment.
During the quarter, we established six operational records.
including our natural gas pipeline volumes, NGO pro-actionation volumes,
and 11.9 million barrels of oil equivalent.
7.9 million barrels of oil equivalent of total pipeline volumes.
We're also extremely proud of the fact that with the increase in our distribution last quarter, we crossed the threshold of 25 consecutive years of distribution growth, literally unheard of in the midstream industry. This is truly...
exceptional milestone across all industries and most importantly
A real tribute to the core principles laid out from our very beginnings that Randa continues to prioritize today. Moving to growth capital.
We started the second quarter with $6.1 billion of major growth projects under construction. We have since completed
construction on four major growth projects that will provide new sources of cash. We have an additional 4.1 billion under construction.
Completing major projects during the second quarter in early July .
include a 400 million cubic foot a day expansion of the Haynesville extension of the Acadian natural gas pipeline system.
which is sold out.
Our Poseidon Cryogenic Natural Guides processing plan.
which is our sixth processing plant in the Midland Basin.
which is sold out.
Our 19th NGL fractionator.
which is sold out.
And our PDUH2 plant...
in Chambers County, which is sold out and ramping up currently between 65 and 70 percent and climbing.
The three main remaining natural gas processing plants we have under construction in the Permian Basin will go into service in late 23 and early 24. One in Midland and one in Delaware.
And the first phase of the Texas Western Products Pipeline will be put into service in December .
When we complete the next three Permian plants, we'll have 16 processing plants in the Permian.
with the capability to process 3.8 BC a day of natural gas and extract more than 520,000 barrels a day of NG house.
all destined for additional value-added services in our Gulf Coast NGL systems.
Meanwhile, downstream of the Permian, we have major expansions underway for ethane, ethylene, polymer-grade propylene, and LPG, expanding and upgrading our export capacity at the ship channel at Morgan's Point and at Beaumont.
Our new export projects are designed with an emphasis on flexibility and reliability.
centered around a highly integrated footprint with multi-product capabilities.
Even as the world works its way through a significant petrochemical downturn, USNGOs and OPINs continue to get a lot of attention.
from petrochemicals focused on feedstock diversity and advantage prices.
In addition to multiple long-term export contracts we recently signed, we are also in discussions with counterparties from several countries for substantial amounts of additional natural gas liquids and olefin exports.
This level of customer interest is what supports further expansion of our export capabilities.
A wide yes to crude spread.
gives the petrochemical industry a feedstock advantage that is proving both durable and permanent.
As Randy's heard me say a million times, I grew up in that business and I've lived through more than a few cycles.
Only the strong prosper
through times like these. And US NGL feedstocks sourced from shale oil and gas are again proving their growing importance.
The durability of U.S. shells is evident in ever-increasing U.S. exports of crude, natural gas, natural gas liquids, and in exports of petrochemicals in various forms.
July Enterprise crude oil exports will exceed a record 30 million barrels.
Oil and gas has faced commodity price headwinds, especially compared to the premiums of last year when crude averaged over $100 a barrel during the first six months of 2022.
We see no reason that crude should have been trading at the low levels of the last few months.
In early June , OPEC Plus announced they were extending their reductions into 2024.
On top of that, the Saudis announced they would unilaterally cut.
an additional 1.1 million barrels a day of production in July and August with the option to extend these cuts as needed.
Meanwhile, waterborne data confirms that Russia's exports are coming down.
Inventories of crude and refined products, both in the US and globally, remain very low, while OPEC Plus continues to demonstrate they are committed to price stability.
Even though industrial demand continues to lag, consumer demand is strong, especially in developed nations.
Good oil supply demand fundamentals continue to indicate that we're in store for much tighter balances for the remainder of the year and in 2024. And with that, I turn it over to Randy.
Okay, thank you, Jim. And good morning, everyone. Starting with the income statement, net income attributable to common unit holders for the second quarter of 2023 was $1.3 billion or 57 cents per common unit on a fully diluted basis.
This compares to $1.4 billion, or 64 cents per common unit, for the second quarter of last year.
Adjusted cash flow from operations or we call it adjusted CFFO which is cash flow from operating activities before changes in working capital was 1.9 billion for the second quarter of this year compared to 2.1 billion for the second quarter of 2022.
As Jim mentioned, 2023 marks our 25th consecutive year distribution growth. We declared a distribution of 50 cents per common unit for the second quarter of 2023, which is a 5.3% increase over the distribution declared for the second quarter of last year.
and a 2% increase over the distribution that we declared last quarter. This distribution will be paid August 14th to common holders of record as of close of business July 31st.
In the second quarter we purchased 2.9 million common units for the for the quarter at a total cost of 75 million dollars. For the first half of the year unit purchases totaled approximately 3.6 million common units for a total purchase price of approximately 92 million dollars.
Inclusive of these purchases, we have now utilized 41% of the authorized $2 billion buyback program.
In addition, our distribution reinvestment plan and our employee unit purchase plan purchased an approximate approximately 2 million common units on the open market, or a total purchase price of approximately $51 million. And that was also during the second quarter.
For the 12 months ending June 30, 2023, Enterprise paid out approximately $4.2 billion in distributions to limited partners. These distributions combined with $307 million in buybacks for this period result in Enterprise having a pay-out ratio of $4.2 billion to $4.2 billion to $4.2 billion.
adjusted cash flow from operations at 57% and a ratio of payout for adjusted free cash flow of 86%.
As Jim noted, we have $4.1 billion of major growth projects under construction, $1.1 billion of which are expected to begin service in the remainder of 2023. We continue to expect our growth capital expenditures for 2023 will be in the range of $2.4 to $2.8 billion depending on any incremental system expansions and timing. We continue to expect sustaining capital expenditures for 2023 will be approximately $400 million.
Turning to capitalization, our total debt principal outstanding was approximately $28.9 billion as of June 30. Assuming the final maturity date for our hybrids, the weighted average life of our debt portfolio was 20 years. Our weighted average cost of debt is 4.6%.
And at June 30, approximately 97% of our debt was fixed right.
Our consolidated liquidity at quarter end was approximately 4 billion dollars and that includes both availability under our credit facilities and unrestricted cash.
For the 12 months ended June 30, 2023, our adjusted EBITDAB was $9.1 billion. This compares to $8.8 billion for the trailing 12 months ending June 30, 2022. We ended the quarter with a consolidated leverage ratio of 3.0 times.
on a net basis after adjusting debt for the partial equity treatment of our hybrid debt and reduced by the partnerships unrestricted cash on hand.
As a reminder, our leverage target remains three times plus or minus 0.25, so if you would, 2.75 to three and a quarter times, so we're right in the middle of that range. And with that, Randy, I think we can open it up for questions. Okay, thank you, Randy. Norma, we're ready to open it up to questions from our listeners.
And I would like to remind our listeners to restrict your questions, please, to one question and one follow-up question.
And I'll take it from you. You go ahead and take it from there, Norma. Thank you. As a reminder, to ask a question, you'll need to press star 11 on your telephone. To withdraw your question, please press star 11 again. Please wait for your name to be announced. Again, we ask that you limit your questions to one with one follow-up. Please stand by. We'll now power the Q&A roster.
One moment for our first question. Our first question comes from the line of Teresa 10 with Barclays. Your line is now open.
If we look at our processing margins, Natalie, they're better than they they've been moving up. Okay, and in terms of outsized spreads
My experience is you can't predict them, but they're always there. And I think we might see more opportunity in the second half than we have seen in the first half. Thank you.
numbers increasing over the last four months, but it really hasn't translated to higher overall demand. So as we talked to customers, you know, what originally was going to be a strong second half is probably pushed out maybe six months or so. And then on the on the MTBE side, you know, it's really a business.
driven by normal arabov and octane that remains strong.
So there was a lot in your question. PDH is ramping up as it ramps up where we're sold out all the way up to the maximum nameplate. So we'll continue to see that perform.
Thank you.
One moment for our next question, please.
Our next question comes from the line of Tristan Richardson with Scotiabank. Your line is now open. Hey, good morning guys. Just curious, Jim, you mentioned discussions with new international customers that you know, maybe you haven't had relationships with before in the past. We think of these incremental customers as
largely around filling export expansions currently underway? Or would these potential relationships be for further expansion to your export capacity down the road?
We signed that contract tub yesterday. Okay, you about ready to execute it one that we're going to execute I think we
We had one large one, I think it was 200,000 barrels a day that we executed recently. We're in discussions with at least two more, Doug.
We had one large one, I think it was 200,000 barrels a day that we executed recently. And we're in discussions with at least two more, four more.
And our guys are headed to Asia for an extended trip. You're not too long. So I guess it's both what we built and what we expect to sign. Okay, helpful. Thanks Jim. And then maybe Randy just curious as we've now seen pH come of mine and and and frac 12 commission.
potential for this elevated spend for these large and critical projects. Coming to a conclusion in 23 such that 24 could be lower than 23.
Yeah, Tristan on that, you know, certainly getting PDH2 completed, that was a big capital project. But when we come in and see the opportunities just in and around our system, I think, frankly, we're going to be in that two, two and a half billion dollar range for the next two to three years.
And some of that, you know, I'll have to say that two to two and a half really is still excluding spot, which is still going through the licensing process. But we're just seeing a lot of good activity, a lot of good growth opportunities across the system.
Appreciate it. Thank you guys very much.
Thank you. One moment for our next question, please.
Our next question comes from the line of Spirit of Dunas with Citi. Your line is now open. Your line is now open.
Thanks, operator. Morning, everybody. I actually want to go back to that a little bit if we could just on capital allocation. So, I guess on my math, I think you still have you guys generating about 10 to 15% of operating cash flow that's sort of unspoken for over the next few years, even with spot in there as well. So just curious at your latest thoughts on preferred ways to allocate that capital, given your leverage levels or
to all the above. Certainly in the last year, year and a half, we've picked back up on the cadence of our distribution growth. And again, that seems like the most direct way to return capital to our partners is through distribution bumps.
But, you know, I think we'll, you know, continue to come in and sort of use all the above.
Yes, fair enough. Second question on Chinook. And Jim, I'll preface this question with I know you're going to expand Chinook at some point, but I also know you've talked about short-term bridging solutions to get there. Just curious if you guys have any updated thoughts on that.
I got a lot of thoughts on that, Pissreira. I was in a two hour meeting yesterday with Brent and Justin.
So you can imagine what it's like spending two hours with Brent and Justin, looking at all of our options. All of our options.
And our options could be we'll add another line called, what are we calling that, Bahia? Or we could partially loop Shinnoke and take
Feminineau out of NGL service. The bottom line is we have to have more takeaway out of the Permian. And...
You know, I guess I've got to have another two or three hours with Justin and Brent. We'll come up with the solution
Sounds good. Appreciate the color, guys. Thanks again.
Thank you. One moment for our next question, please.
Our next question comes from the line of Jeremy Tenet with JP Morgan Securities. Your line is now open.
Hi, good morning. Just wanted to start off with some of the NGL dynamics as you talked about before. I think you mentioned how the ethane prices have been volatile as of late. I'm just wondering if you see that as kind of...
logistics constraints given heat in Texas or otherwise and I guess future outlook for ethane and propane prices at this point given the volatility that we've seen recently.
Dr. Brent? On ethane, I think what you saw last month is when nominations were due for ethane recoveries.
The forward curve probably said not to recover. So you saw a bunch of F-A and give rejected in the Permian Basin. You couple that with some operational issues on various plants across the entire basin. There was some frack rates that were lower than normal. And that made F-A very, very tight.
I think if you look out forward, I think some of that volatility is going to suppress, and I think we get back to probably more of a normal type ratio between ethane and natural gas. There's a culmination of factors that cause that.
Graham, turn on your mic. We always talk. We worry about plants going down in the winter.
What's 103?
06.
Certainly there's some challenges with challenges with that, but I wouldn't say it's been a material impact on our operating operating rates We generally designed for those conditions about others
I can't speak for others. Well, I'm trying to get you to. And then just real quick on propane, when you look at just overall global demand, I think we've had poor PDH plants come up in China.
So far this year there's 11 other PDH plants scheduled to come online for the balance of this year. How much pro-plant is that all in? I mean if you say 100% capacity factor, that's another 250,000 barrels a day. Those plants aren't running at those higher rates, but call it 65 to 70%.
It will certainly put another bid under propane just no matter how fast production comes online. I would hope that we've seen the bottom on propane. That's my hope.
If not, it will still price to export, right?
That's right.
Got it. That's helpful. Thanks. And just as we look going forward here, we keep seeing enterprises leverage dipping down below 3. and just wondering if that trend continues. What should we expect at that point leverage just continues to decline or I think 2 to 2 and a half billion of capex next year. Could that increase or just.
times. You know and I think again the team is really bringing in some some good commercial opportunities. We think growth capex would be two two and a half billion and again as I mentioned earlier that is without spot.
So, you know, I think we would just like to develop, let's see it develop. You know, as far as returning capital, you know, we said we picked up the pace on distribution growth, still doing some buybacks, balance sheet is in great shape. And Jeremy, I guess just staying in a position that...
you know, a lot of opportunities come along. We just want to be in a good position to execute on. Got it. That's helpful. Thank you.
Our next question comes from the line of Jean Ann Salisbury with Bernstein. The line is now open. Hi, good morning. Has the scope changed a bit for the Beaumont export terminal? It looks like from the slides you're adding propane exports there. You're pretty observant, Jean Ann. Go ahead, Todd. All right, so yeah, the scope has changed on that. We previously announced a 120,000 borrel a day ethane train at Beaumont, and now what we're doing is we're proceeding with that train in addition to a 180,000 borrel a day ethane train that can also do up to 360,000 borrels a day of propane.
facility to increase our butane loading rates and allow for fully refrigerated PGP.
So, Jean Ann, in my script, I said, multi-product.
flexibility. That's why, so Tug can go to somebody and say look
you can take three tanks of ethane and a tank of ethylene. Or you can take three tanks of ethane and a tank of propane, or vice versa. So we're trying to fix it where those things will always be full, but not necessarily the same product.
Butane, propylene, ethane, ethylene, you name it. Interesting, thank you. And then is the Acadian expansion running full already and maybe more broadly in your opinion, is Haynesville just completely full on gas takeaway now until as new pipes come on?
Hey, Jen, this is Natalie. Haynesville for us, our Canadian extension is full.
gas continues to produce in the, even on our gathering systems, we're getting more and more gas every day.
Great, thanks. That's all for me.
Our next question comes from the line of Colton Bean with TPH and Company. Your line is now open. Your line is now open.
Morning. Just shifting back to the backlog. On the expected 24 growth capital range, Randy, I think you outlined the two to two and a half billion. Currently improved projects look to be closer to 1.4. So you can use characterized with type of projects that you're expecting to reach FID on. And then the hurdles you would need to clear to move those projects into the official backlog.
Yeah, Colton Brent, you want to take some of this because you've built the front line of it. I mean, I just to generalize this, Colton, I think everything's gonna be centered around the Permian Basin. So whether that's...
an NGL pipe solution, whether that's processing plants or whether that's an additional fractionator, it's going to be all centered around permeate production growth. Yeah, it's effectively all going to be a supply chain. Makes sense. And then on the operations side, it looks like Midland processing earnings relatively...
Thank you. Thank you.
Perfect. Thank you.
Thank you. One moment for our next question, please.
Your next question comes from the line of Keith Stanley with Wolf Research. Your line is now open.
Hi, good morning. Wanted to start on on spot just any update on commercial momentum and remaining permitting process. And how soon you could conceivably get to an FID on that project.
We, I think we should have our license to construct Graham in September , October .
Yeah, that's where it's trending right now. Everything's going well right now in the licensing stage and we're expecting in the next within the next few months. In terms of, I mean, we're traveling the world.
spot where we have a laser focus on getting customers on spot and I think we will
And I believe we'll end up building it.
Okay, and that could be by next year even to be starting construction on that do you think?
next year even to be starting construction on that, do you think? Well, if.
Tug and Brent would get off their rear end and get to Asia and see everybody. It would probably be sooner rather than later.
We're going to commercialize this thing and we've got meetings
Brent and I are going to Europe later this month. Brent.
in September and the focus is on spot where we were pulling out all
The focus is on spot where we were pulling out all.
Thanks to get it done.
Okay, thanks for that. And the second question is just on the year overall. So the project 9.3 billion target for EBITDA, you did four and a half in the first half, but as you've pointed out a lot, you have a lot of major projects starting up. Commodities are improving.
Any updated thoughts on how you're feeling on that target, things that need to go right, areas where you may have cushion, etc.
updated thoughts on how you're feeling on that target, things that need to go right, where you may have cushion, etc.
I say this every time, that's not guidance.
But it's a goal and we reward all of our employees.
And we reward all of our employees if we hit that goal.
And somebody asked on one earnings call, have we ever had a goal that we didn't make? We're bound and determined that our employees are gonna be rewarded by.
Somebody asked on one earnings call, have we ever had a goal that we didn't meet? We're bound and determined that our employees are gonna be rewarded by meeting 9.3. We're bound and determined that our employees are gonna be rewarded by meeting 9.3.
What's going to help us, I think, is if you talk to Tony, I mean crude prices, I don't know what they're doing today, Tony, but they've been up $10 in the last 30 days.
You know, the balances are tight.
All of our plants are full of the key and Graham knows this. I think the key is keep the plants running because we will capitalize.
on any volatility.
Thank you.
Thank you. One moment for our next question, please.
Our next question comes from the line of Brian Reynolds with UBS. Your line is now open.
Hi, good morning everyone. To talk on the crude business, it seems to be finding its footing in terms of margin opportunity for the first time since COVID. So curious if you could just opine on whether you're seeing incremental barrels and opportunity come back to Houston as Corpus remains full, and if we continue to see green shoots into the back half of 23. Thanks. And thinking my script what I said is we, we set a record.
Yeah, well, Brent, I think you're seeing barrels move.
on in toward Houston. And Brent, before you answer that, but also talk about our quality improvements across the system.
I think fundamentally we believe in Tony's production numbers as we go forward.
We do think that the corpus pipelines are full. We think that we've done what we've done on our system as it relates to quality.
has brought more interest and I do think when we speak to our customers they want a bigger and bigger position in Houston.
So I think over time, and the other piece on this is not all pipelines are created equal. There's other pipelines that go to Houston or go to Beaumont that are more challenged than our integrated crude pipelines. So I think we're going to be the beneficiaries going forward. Thank you.
Yeah, I mean just nature you being able to deliver and data Brent what we've done on our system You're seeing the open interest on that contract continue to go up We've sent records in the last couple weeks on daily traded volume I think I just had a press release recently went through some of those details, but all this just put together
lends itself to more interest in trying to get to Easton on our pipelines. I'm not supposed to ask questions, but I will anyway. Where's Jay?
How many of your cargos have met dated Brent specs? Since we implemented the new quality specification mimicking the plat spec we've met, every one of our export cargos have met that specification since we adopted it in May.
Great, thanks for all the color. And maybe to just touch a little bit on M&A, you know, commentary coming out of the analyst aid made it seem like it was coming or attractive for Enterprise, but with nothing, you know, year to date and, you know, EPD continuing to maintain its high bar.
for returns. Just kind of curious if you could just give us a forward-looking update on potential M&A appetite or whether other uses of capital could impact the use of M&A going forward. Thanks. One of the things about building plants is you could build them where you want them.
That's what I love about building all these plants in the Burmian, and we're probably not through.
building a fractionator where you want it.
That's my color, but Randy is the one you should ask. It makes me want to go back and reread our transcripts from the analyst day. I didn't know we were that bullish on M&A. But yeah, you know again, we'll take a look at opportunities that come up. We're on every bankers Rolodex, so we get a opportunity to take a look and you know, but I can't say that
we're predisposed to come in and jump on M&A if it makes sense, good return on capital and it you know, if it fits the system, dovetails in. I think that's one discipline that we've had over the years. It's not building a collection of assets, but coming in and actually ties in and bolts onto our system and provides downstream or upstream opportunities.
We'll continue to look at that. All makes sense. Appreciate the color. Thanks. One moment for our next question, please. Our next question comes from the line of Michael Bloom with Wells Fargo. Your line is now open.
Thank you. Good morning, everyone. I wanted to go back to, I think, the opening comments. You may touch on this a little bit, but I want to ask just specifically how you're seeing China demand right now as it relates to NGLs.
And where you think that's headed. Yeah, Michael, this is Brent. If you look at and let's take LPGs first that came from our terminal.
In the first quarter, that number was 24% of our volumes went to China.
Second quarter we averaged 38%. So when we go back and talk about those PDH plants, I think that's some effect right there. And then when you go to ethane, first quarter was about 33%.
Second quarter 26% went to China with what TUGS been doing on ethane contracts. I think you'll see that number go up of what's going to China.
Got it. And then just have like a broad question on drilling activity. Are there any regions you'd highlight where you're just seeing a change in either rig activity or messaging from producers either up or down?
Yeah, this is Tony, Michael. You know, we're in the middle of earning season and producers are reporting, but if you look at, you know, think Exxon, think Chevron, Diamondback reported today, everybody is saying the same thing. They continue to say.
drilling and completion efficiencies, and not by a little. They are seeing cost mitigation and predicting, depending on where they are in the value chain, some amount of even deflation on costs. So better returns.
When you look at the longer laterals are key to what they're doing, cube development, I mean the producer continues to get even more and more efficient. So you know we look at it all the time, we talk about it, we talk about it with each of our producers. It's been difficult.
to look at the EIA numbers and try to figure out what production is doing, but I can tell you that we're on target for our own numbers to be in the five to seven hundred thousand barrel a day range increase year in to year end.
And watch what the producers are saying during the second quarter. No one has a bad story. Everybody is very, very upbeat.
And on top of that, I guess last but not least.
Our own calculation are ducks or they continue to grow so not only are things going well for them but they're building significant amount of headroom.
Hainesville rigs, you know, let's look at completions there. Completions, frack crews in Hainesville went from call it 15 to 18 down at a point to 7. They're back up to around 14 today. If you look at the forward curve, the forward curve says Hainesville drillers.
should keep filling that they have value there. So it is, the world is now watching it as that variable based in the United States for natural gas production that you go, I'm just gonna use some generic numbers. It can go up to BCF or it can go down to BCF. And that's a four BCF swing over time about an 18 month period.
That's what you've seen through the cycles and things, though.
you've seen through the cycles in Hainesville. Perfect. Thank you.
Thank you. One moment for our next question, please.
Our next question comes from the line of Neil Dingman with Chuous Securities. Your line is now open.
Thanks for the time. My first question is on Permian processing margins given Waha pricing. I'm just wondering, how do you see the margins going forward, including the impact from your fee floors?
I think they will be better in the second half.
It worked great in the first half. Is that fair? That's fair.
on the percent that hits the floor, it gets a lot less.
Okay, thanks. And then 2nd, just on the marine exports, I think you all previously mentioned strong demand and Jim, I think even mentioned, I think it was around 240,000 barrels a day of new contracts. Is this still
expectations or are you seeing you know kind of production continue to grow in this area? I think you know if you look at what we're doing it kind of tells you what we believe.
What we're doing is expanding our ability to export across.
the hydrocarbons chain.
So.
Yeah, we, you know, we believe if Tony, if Tony's wrong, hell, I...
He's somebody's houseboy, I guess, but that's what I was doing.
Thank you all.
Thank you. One moment for our next question.
Thank you one moment for our next question
Our next question comes from the line of Neil Mitra with Bank of America. Your line is now open.
Hi, thanks for taking my question. I wanted to ask your exposure to spot ethane prices. Were you able to sell spot ethane out of maybe some of your purity storage in Mont Belvue to downstream players and benefit from that?
And conversely, did you have any downstream obligations like, you know, possibly being short on Morgan's point because of outages? Just wanted to see how that would kind of play out for 3Q now that we have a full month of prices over 30 cents a gallon.
You know one of the most valuable assets we have is our storage and yes, we were able to take advantage of the volatility on that thing.
And no, we were of no issues with being short at Morgan's Boiler. Anywhere else?
Great. And then second question, we started the year off in the first quarter with very little
high LPG exports and I know we're seasonally weaker in the second quarter. When does that seasonality start to pick up so that it's a benefit again for the second half of the year?
Let's let Todd take it. But I mean, what's our export volume? We're going to be a little bit soft in the month of August . What do you call soft? 18 million barrels? Yeah, right around there. I don't call that soft. But around September , we're fully...
looked up and then I'll just note as well that we are seeing dock margins increase specifically in the month of August and September forward.
Thank you.
Thank you. I'm currently showing no further questions at this time. I'd like to hand the conference back over to Mr. Randy Burkhalter for closing remarks.
Thank you, Norma. I think that covers it pretty well. I don't have any closing remarks. I'd just like to thank everybody for joining us today for our call and have a good day. Goodbye on it.
This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day.
I.