Q1 2025 ONEOK Inc Earnings Call

Okay.

Good day, everyone and welcome to the first quarter 2025 earnings Conference call.

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Megan Patterson: time I'd like to turn the floor over to Megan Patterson, ma'am, please go ahead.

Megan Patterson: I'd now like to turn the floor over to Megan Patterson. Please.

Speaker Change: Please go ahead.

Speaker Change: Thank you Jamie and welcome one of the first quarter 2025 earnings call, we issued our earnings release and presentation. After markets closed yesterday and those materials are under website. After our prepared remarks management will be available to take your questions Steve.

Pierce Norton: Jamie, and welcome to One Oak's first quarter 2025 earnings calls. We issued our earnings release and presentation after the markets closed yesterday, and those materials are on our website. After our prepared remarks, management will be available to take your questions. Statements made during this call that might include one of expectations or predictions should be considered forward-looking statements and are covered by the Safe Harbor Provision of the Securities Acts of 1933 and 1934. Actual results could differ materially from those projected in forward-looking statements. For discussion of the factors that could cause actual results to differ, please refer to our SEC filings.

Speaker Change: Statements made during this call, but my expectations or predictions should be considered forward looking statements and are covered by the safe Harbor provision of the secure.

Speaker Change: <unk> 1933 and 1934.

Speaker Change: Actual results could differ materially from those projected in forward looking statements for a discussion of the factors that could cause actual results to differ please refer to our SEC filings.

Unknown Executive: Just a reminder for Q&A that we ask you to limit yourself to one question and one follow-up to fit in as many of you as we can.

Speaker Change: As a reminder for Q&A, we ask you to limit yourself to one question and one follow up in as many of you as we can.

Pierce Norton: And with that, I'll turn the call over to Pierce Norton, President and Chief Executive Officer. Pierce. Thanks, Megan. Good morning and thank you for joining us. On today's call is Walt Hulse, the Chief Financial Officer, Treasurer and Executive Vice President, Investor Relations and Corporate Development, and Sheridan Swords, Executive Vice President and Chief Commercial Officer. Also on the call are Kevin Burdick, the Executive Vice President and Chief Enterprise Service Officer, and Randy Lentz, Executive Vice President and Chief Operating Officer. Yesterday, we announced our first quarter results highlighting the performance of our integrated systems and the discipline growth strategy.

Pierce Norton: With that I'll turn the call over to Pierce Norton, President and Chief Executive Officer, Gary Thanks, Mike.

Walt Hulse: Good morning, and thank you for joining us on today's call is Walt Hulse, Chief Financial Officer, Treasurer, and Executive Vice President Investor Relations and corporate development and Sheraton source Executive Vice President and Chief Commercial Officer also on the call, Kevin Burdick, Executive Vice President and Chief Enterprise.

Walt Hulse: As service Officer, and Randy Lynch, Executive Vice President and Chief operating Officer.

Walt Hulse: Yesterday, we announced our first quarter results highlighting the performance of our integrated systems and a disciplined growth strategy.

Pierce Norton: These results were driven by dedicated employees. Results for the quarter were in line with our first quarter expectations, and we affirmed our 2025 financial guidance and 2026 outlook. both of which were originally provided in late February. As we've exited the winter, volumes across our system have wrapped up significantly, providing momentum for additional growth through the remainder of the year. We're also entering what is typically our strongest two quarters for the refined products demand in the second and third quarter. We continue to execute on acquisition related synergies, which combined with the completion of organic growth projects and the demand for our services will continue to support earnings growth throughout the remainder of the year and beyond.

Walt Hulse: These results were driven and dedicated employees.

Walt Hulse: For the quarter were in line with our first quarter expectations, and we affirmed our 2025 financial guidance in 2026 outlook.

Walt Hulse: Of which were originally provided in late February.

Walt Hulse: As we exited the winter volumes across our system have ramped up significantly providing momentum for additional growth through the remainder of the year.

Walt Hulse: Also entering what is typically our strongest two quarters further refined products demand in the second and third quarters.

Walt Hulse: We continue to execute on the acquisition related synergies, which combined with the completion of organic growth projects and the demand for our services will continue to support earnings growth throughout the remainder of the year and beyond.

Walt Hulse: We're approaching full completion of several organic growth projects, including the West, Texas NGL pipeline expansion out of the Permian Basin, and the Elk Creek pipeline expansion out of the Rocky Mountain region.

Pierce Norton: We're approaching full completion of several organic growth projects, including the West Texas NGL Pipeline Expansion out of the Permian Basin and the Elk Creek Pipeline Expansion out of the Rocky Mountain Additionally, a number of key Synergy-related projects are nearing completion, which we expect will provide a tailwind to earnings for the second half of 2025 and into 2026. One of these projects is the connection of the Easton Energy NGL assets with our Gulf Coast infrastructure.

Walt Hulse: Additionally, a number of key synergy related projects are nearing completion, which we expect will provide a tailwind to earnings for the second half of 2025 and enter 2026.

Walt Hulse: One of these projects is the connection of the eastern <unk>.

Walt Hulse: Energy NGL assets with our Gulf Coast infrastructure.

Pierce Norton: Sheridan will talk more about the strategic benefits of our Synergy projects during his commercial update. As we've entered the second quarter, we're gaining momentum into the back half of 2025 with volumes ramping up across our systems and many smaller scale high return synergy projects coming online. While there is much to be excited about at 1-0, we also recognize that we're operating in an environment with a number of evolving macroeconomic market variables. We closely monitor a range of macroeconomic indicators, including commodity prices, producer activity, inflationary trends, and regulatory developments, and we remain focused on navigating appropriately to shifts that could affect the markets that we serve.

Walt Hulse: Sheridan, we'll talk more about the strategic benefits of our synergy projects during his commercial update.

Walt Hulse: As we've entered the second quarter, we're gaining momentum in the back half of 2025 with volumes ramping up across our systems and many smaller scale high returns energy projects coming online.

Walt Hulse: While there is much to be excited about at <unk>. We also recognize that we're operating in an environment with a number of evolving macro economic market variables.

Walt Hulse: We closely monitor a range of macroeconomic indicators and closing commodity prices and producer activity.

Walt Hulse: Shneur Retrans and regulatory developments and we remain focused on navigating appropriately two shifts.

Walt Hulse: The markets that we serve.

Walt Hulse: Although business is completely immune to volatility we believe that one on cost structure to perform through various cycles and is in a position.

Pierce Norton: While no business is completely immune to volatility, we believe that One Oak is structured to perform through various cycles and is in a position to continue delivering value.

Walt Hulse: To continue delivering value.

Pierce Norton: First, One of what's very different today, and even two years We've been intentional about adding scale, demand pull markets, geographic diversification, and fully integrating our system. are integrated and diversified footprint across multiple products in geography. Physicians, as well to manage through periods of uncertainty. Second, we have a unique and attractive earnings catalyst related to acquisition synergies that are not tied directly to production volume growth. Some of these catalysts include bundling services, liquids blending, maximizing volumes from acquired systems to our downstream assets, and capturing efficiencies on newly integrated assets. Third, our strategically positioned assets are in some of the most productive US shield bases.

Walt Hulse: First.

Walt Hulse: On up looks very different today than even two years ago.

Walt Hulse: And intentional about adding scale demand pool markets.

Walt Hulse: Geographic diversification and fully integrating our systems.

Walt Hulse: Our integrated and diversified footprint across multiple products and geographies.

Walt Hulse: <unk> us well to manage through periods of uncertainty.

Walt Hulse: Second we have a unique and attractive earnings catalyst related to acquisition synergies that are not tied directly to production volume growth. Some of these catalysts include bundling services liquids blending maximizing volumes from acquiring systems, alright downstream assets and capturing efficiencies on newly integrated assets.

Walt Hulse: Third our strategically positioned assets in some of the most productive U S shale basins.

Pierce Norton: We're connected with some of the largest and most well-capitalized producers in the U.S. with decades of proven reserves to provide stable and growing supply to our system. that make informed decisions supported by data and experience.

Walt Hulse: Connected with some of the largest and most well capitalized producers in the U S with decades of proven reserves to provide stable and growing supplier to our systems.

Walt Hulse: And make informed decisions supported by data and experience.

Pierce Norton: And finally, we remain committed to our strong balance sheet and investment grade credit ratings, which provides significant financial flexibility, our commitment to capital discipline and focus our return investments is embedded into our business strategy. So while we monitor near-term market dynamics closely, the strength of our businesses lie in our geographic diversity, integrated footprint, innovative employees, and strong commercial relationships, all of which provide long-term value.

Walt Hulse: And finally, we remain committed to our strong balance sheet and investment grade credit ratings, which provides significant financial flexibility.

<unk> commitment to capital discipline and focus our return investments is embedded into our business strategy.

So while we monitor near term market dynamics.

Walt Hulse: The strength of our businesses and our geographic diversity.

Walt Hulse: <unk> footprint innovative employees and strong commercial relationships all of which provide long term value.

Speaker Change: I'll now turn it over to walk and Sheraton to provide the financial and commercial update as well.

Walter Hulse: I'll now turn it over to Walt and Sheridan to provide their financial and commercial updates. Walt. Thank you, Pierce. First quarter 2025 net income attributable to one out totaled $636 million or a dollar four per share. We reported first quarter adjusted EBITDA of $1.78 billion or $1.81 billion excluding transaction costs, which is comparable to how we provided financial guidance. Results were driven primarily by a full quarter of adjusted EBITDA from M. Lincoln Medallion as well as higher year-over-year NGL and natural gas processing volumes in the Rocky Mountain region. These results were partially offset by the absence of earnings in 2025 from the interstate pipeline assets divested on December 31st, 2024.

Speaker Change: Thank you Pearce.

Speaker Change: First quarter 2025, net income attributable to <unk> totaled $636 million or $1 four per share.

Speaker Change: Our reported first quarter adjusted EBITDA of 1.78 billion or 1.81 billion, excluding transaction costs, which is comparable to how we provided financial guidance.

Speaker Change: Results were driven primarily by a full quarter of adjusted EBITDA, and Linkedin medallions as well as higher year over year, NGL and natural gas processing volumes in the Rocky Mountain region.

Speaker Change: These results were partially offset by the absence of earnings in 2025 from the Interstate pipeline assets divested on December 31 2020 for.

Walter Hulse: The proceeds of these sales were used to accelerate the leveraging of our balance sheet. The acquired and linked in Medallion assets contributed nearly $450 million during the first quarter. As we progress on the integration of these businesses, we continue to identify and realize synergies with $250 million of total incremental synergies expected in 2025. We've added a new slide into our earnings presentation, which was released yesterday, along with first quarter results, slide five in the deck. It shows the expected earnings power of our combined companies as compared with each company's standalone five-year plan prior to the closing of these acquisitions.

Speaker Change: The proceeds of these sales were used to accelerate deleveraging of our balance sheet.

Speaker Change: The acquired Lincoln medallion assets contributed nearly $450 million during the first quarter.

Speaker Change: As we progress on the integration of these businesses, we continue to identify and realize synergies with $250 million of total incremental synergies expected in 2025.

Speaker Change: We've added a new slide into our earnings presentation, which was released yesterday, along with first quarter results slide five in the deck.

Speaker Change: It shows the expected earnings power of our combined companies as compared with each company stand alone five year plan prior to the closing of these acquisitions.

Walter Hulse: Over the coming years, we anticipate our consolidated EBITDA will meaningfully outperform some of the individual company forecast. This further growth is primarily driven by synergies and growth projects made possible by commercial alignment, operational efficiencies, scale, and discipline capital execution. When looking at this slide, it's important to recognize that 2024 results include earnings from the divested assets, and years 25 forward exclude assets, and those assets, keep it down in the form. We continue to demonstrate our commitment to balance sheet strength, ending the quarter with no borrowings outstanding under our $3.5 billion facility and more than $140 million in cash.

Speaker Change: Over the coming years, we anticipate our consolidated EBITDA, while meaningfully outperform some of the individual company forecasts.

Speaker Change: Further growth is primarily driven by synergies and growth projects made possible by commercial alignment operational efficiencies scale and disciplined capital execution.

Speaker Change: When looking at this slide it is important to recognize that 2024 results include earnings from the divested assets in 20 years 25 forward excluding assets EBITDA in those.

Speaker Change: The EBITDA forecast.

Speaker Change: We continue to demonstrate our commitment to balance sheet strength, ending the quarter with no borrowings outstanding under our $3 5 billion dollar facility and more than $140 million in cash and.

Walter Hulse: In March, we repaid $250 million of senior notes at maturity with cash on hand as we have with our last five maturities. And we continue to expect leverage to trend towards our target of three and a half times in 2026.

Speaker Change: In March we repaid $250 million of senior notes at maturity with cash on hand, as we have with our Fi last five maturities.

Speaker Change: And we continue to expect leverage to trend towards our target of three and a half times in 2026.

Walter Hulse: Before I turn it over to Sheridan, I'd like to reiterate Pierce's comments on the current environment. From a financial perspective, we are constantly evaluating how external factors contribute to our results. Our 2025 financial guidance provided in late February, which we affirmed yesterday, reflects what we believe is a balanced and realistic outlook given current market conditions. The first quarter was in line with our internal company forecast, and we expect a combination of seasonal refined product demand, volume growth coming from the winter months. Completed capital projects and additional synergies will increase our results in the coming quarter.

Speaker Change: Before I turn it over to Sharon I'd like to reiterate <unk> comments on the current environment.

Sharon: From a financial perspective, we are constantly evaluating how external factors contribute to our results.

Sharon: Our 2025 financial guidance provided in late February, which we affirmed yesterday reflects what we believe is a balanced and realistic outlook given current market conditions.

Sharon: First quarter was in line with our internal company forecast and we expect that the combination of seasonal refined product demand volume growth coming from the winter months.

Sharon: <unk> capital projects and additional synergies will increase our results in the coming quarters.

Walter Hulse: In addition to these earning catalysts, we remain disciplined in our approach to capital allocation and cost management.

Sharon: In addition to these earnings catalysts, we remain disciplined in our approach to capital allocation and cost management.

Walter Hulse: If we were to see a prolonged or material shift in the economic environment, we would not hesitate to adjust our capital plans or reprioritize investment to maintain our financial flexibility and our commitment to a strong balance sheet, as we've previously demonstrated.

Sharon: If we were to see a prolonged or material shifts in the economic environment, we would not hesitate to adjust our capital plans are re prior prioritize.

Sharon: To maintain our financial flexibility and our commitment to a strong balance sheet as we've previously demonstrated.

Sheridan Swords: Now I'll turn the call over to Sheridan for a commercial. Thank you all.

Now I'll turn the call over to Sharon for commercial update.

Sharon: Thank you will.

Sheridan Swords: beginning with the natural gas liquid cycle. First quarter NGL volumes increased 4% year-over-year, driven by a 15% increase in the Rocky Mountain region, and an 8% increase in the Gulf Coast Permian volume. Rocky Mountain Region volumes increased year-over-year in line with our expectations. We continue to see volumes ramp up on our system as we've exited winter, and volumes are currently averaging nearly 480,000 barrels per day in April. In the mid-continent, seasonal weather combined with less ethane on our system during the quarter resulted in lower volumes. In April, we are averaging more than 540,000 barrels per day with warmer weather, more ethane recovery, and growth in Oklahoma.

Speaker Change: Beginning with the natural gas liquids segment.

Speaker Change: First quarter NGL volumes decreased 4% year over year, driven by a 15% increase in the Rocky Mountain region.

Speaker Change: On an 8% increase in the Gulf Coast Permian volume.

Speaker Change: Rocky Mountain region volumes increased year over year in line with our expectations. We continue to see volumes ramp up on our system as we exited winter and volumes are currently averaging nearly 480000 barrels per day in April.

And then carton seasonal weather combined with less ethane on our system during the quarter resulted in lower volumes.

Speaker Change: In April we are averaging more than 540000 barrels per day with warmer weather more ethane recovery and growth in Oklahoma.

Sheridan Swords: As a reminder, all in-link NGL volumes from the Mid-Continent region was transported previously on our system prior to the acquisition. In the Gulf Coast Permian region, volumes increased year over year and, compared with the fourth quarter 2024, of the 436,000 barrels per day of volume in the region during the quarter, nearly 100,000 barrels per day was attributable to in-link volume not previously counted on our system. to all feed throughput in the region was impacted by winter weather during the quarter, particularly the extreme cold snap in February and lower levels as they recovered. In April, Gulf Coast premium in-jail volumes is averaging more than 500,000 barrels per day with improved weather, and we anticipate additional volumes to ramp up over the next few quarters from both one-oak natural gas processing plants and third-party volume commitments on our We also continue to strategically pursue commercial synergies across our system, such as linking our Mont Bellevue and Conway engine oil fractionation and storage infrastructure to our expansive Houston and Mid-Continent Area refined product assets.

Speaker Change: As a reminder, all enlink NGL volumes from the mid continent region was transported previously on our system prior to the acquisition.

Speaker Change: In the Gulf Coast, Permian region volumes increased year over year, and compared with the fourth quarter 'twenty 'twenty four.

Speaker Change: Of the 436000 barrels per day of volume in the region during the quarter nearly 100000 barrels per day was attributable to Enlink volume not previously counted on our system.

Speaker Change: Lumpy throughput in the region was impacted by winter weather during the quarter, particularly in the street extreme cold snap in February and lower levels.

Speaker Change: Okay.

Speaker Change: And April Gulf Coast premium NGL volumes is averaging more than 500000 barrels per day with improved weather and we anticipate additional volumes to ramp over the next few quarters from both one oak natural gas processing plants and third party volume commitments on our system.

Speaker Change: We also continued to strategically pursue commercial synergies across our system.

Speaker Change: And just linking our Mont Belvieu, and Conway, NGL fractionation and storage infrastructure to our expansive Houston and mid continent area refined product assets.

Sheridan Swords: These critical connections are expected to be completed in the second half of the year, increasing contributions from the future integration of these strategic systems. Expected NGO growth across our system supports our strategic Texas City LPG Export Joint Venture. This wellhead-to-water strategy will provide customers with a fully integrated solution for their product. Already today, we have more than enough propane on our system to fill our capacity on the dock, which is slated to be completed in early 2028.

Speaker Change: Each critical connections are expected to be completed in the second half of the year, increasing contributions from the future integration of these strategic systems.

Speaker Change: Expected NGL growth across doses system supports our strategic.

Speaker Change: Texas City LPG export joint venture this wellhead to water strategy will provide customers with a fully integrated solution for their products.

Speaker Change: Already today, we have more than enough propane on our system to fill our capacity on the dock, which is slated to be completed in early 2028.

Sheridan Swords: Moving on to the refined product and crude segment. First Quarter Refined Product Volumes were nearly unchanged year-over-year, highlighting the continued consistency of this business. With gasoline and diesel demand typically lower in the first quarter, we expect increased volumes in the coming months as we see higher demand from agriculture activity and summer travel. We have already seen an increase in crude oil volumes on our system as a result of our added gathering. First quarter 2025, Midland crew gathered volumes were up more than 20% year-over-year, which includes both the in-link and medallion. We expect additional volumes to be directed to our long-haul pipelines throughout the year as we continue to fill gathering capacity and complete system connections.

Speaker Change: Moving on to the refined products and crude segments.

Speaker Change: First quarter refined product volumes were nearly unchanged year over year, highlighting the continued consistency.

Speaker Change: With gasoline and diesel demand typically lower in the first quarter, we expect increased volumes in the coming months as we see higher demand from agriculture activity and summer travel season.

Speaker Change: We have already seen an increase include a crude oil volumes on our system as a result of our added gathering infrastructure.

Speaker Change: First quarter 2025, Midland crude gathered volumes were up more than 20% year over year, which includes both the enlink medallion systems we.

Speaker Change: We expect additional volumes to be directed to our long haul pipeline throughout the year as we continued to build gathering catastrophe and complete system connections.

Sheridan Swords: Moving on to the natural gas gathering and processing site. Through recent acquisitions, we've extended our gathering and processing assets into the strategic and growing Fermion Basin. and added assets in the mid-comp. We've added 1.7 bcf per day of processing capacity in the permeate and more than doubled our processing capacity in the basement. In the Permian Basin, we currently have 16 active ribs on our dedicated egg This activity level and the opportunities we see on the horizon are expected to fill our existing processing capacity. In the Midland, we are relocating 150 million cubic feet per day planned from North Texas.

Speaker Change: Moving on to the natural gas gathering and processing segment.

Speaker Change: Through recent acquisitions, we've extended our gathering and processing assets and just strategic and growing Permian basin.

Speaker Change: And add an asset in the mid con.

Speaker Change: We've added one seven Bcf per day of processing capacity in the Permian and more than doubled our processing capacity.

Speaker Change: And the Permian Basin. We currently have 16 active rigs on our dedicated acreage.

Speaker Change: Activity activity level and the opportunities we see on the horizon are expected to fuel our existing processing capacity.

Speaker Change: And the bid than we are relocating 150 million cubic feet per day, playing from North, Texas and in the yellow we have expansion projects at existing processing facilities Beast.

Sheridan Swords: And in the Delaware, we have expansion projects at existing processing facilities. These projects provide a path to growth as we take steps to develop additional infrastructure in both the Midland and Delaware Basins. We are excited about the long-term potential in this region and the opportunities that we've seen in the short time since closing the Act. In the mid-continent, both our legacy One Oak and recently acquired assets performed well. As we now have had a quarter of operations with a much larger position in Oklahoma, we are confident in the opportunities we have to expand our services for customers and to capture synergies from operating as one integrated system.

These projects provide a path to growth as we take steps to develop additional infrastructure in both the Midland and Delaware basins.

Speaker Change: We are excited about the long term potential in this region and the opportunity set we see in the short time since closing the acquisition.

Speaker Change: In the mid continent, both our legacy and recently acquired assets performed well as.

Speaker Change: As we now have had a quarter of operations with a much larger position in Oklahoma. We are confident in the opportunities we have to expand our services for customers and to capture synergies from operating as one integrated system.

Sheridan Swords: There are 14 rigs on our dedicated acreage in Oklahoma and a number of projects underway to connect and optimize these assets in the region. Mid-continent region processing volumes are averaging more than 2.4 bcf per day. Rocky Mountain Region processing volumes averaged nearly 1.6 BCF per day in the first quarter of 2025, slightly lower than the fourth quarter due to normal winter weather. As we enter springs, volumes have began ramping, with April volume averaging nearly 1.7 bcf per day. In the Wilstead Basin, there are 15 rigs on our dedicated acreage. volume in this region continues to benefit from increasing efficiencies that expand the basin's core acreage and from longer laterals.

Speaker Change: There are 14 rigs on our dedicated acreage in Oklahoma and a number of projects underway to connect and optimize these assets and reach.

Speaker Change: Mid continent region processing volumes are averaging more than two point.

Speaker Change: Four Bcf per day.

Speaker Change: Rocky Mountain region processing volumes averaged nearly one six bcf per day in the first quarter 2025, slightly lower than the fourth quarter due to normal winter weather effects.

Speaker Change: As we enter springs volumes that began ramping with April volume, averaging nearly one seven bcf per day in the region.

Speaker Change: In the Williston Basin, there are 15 rigs on our dedicated acreage.

Speaker Change: Volume in this region continues to benefit from increasing efficiencies expanded basis core acreage and from longer laterals drilled in 2025, we expect three mile laterals to makeup.

Sheridan Swords: In 2025, we expect three-mile ladles to make up more than 35% of our wealth. When looking at producers or costs across their operations, portfolios and economics are unique to every operator and depend on many variables. And in basins where we operate, many of our customers are among the lowest cost operators in North America, with break-evens below current price levels. Based on recent conversations, we are not seeing any meaningful shift in drilling or completion activities.

Speaker Change: That make up more than 35% of our wells connected.

Speaker Change: When looking at producers our costs across our operations. We're filling those economics are used every operator and depends on many variables.

Speaker Change: And in Asia, where we operate many of our customers have bumped the lowest cost operators in North America with breakeven below current price levels.

Speaker Change: Based on recent conversations we are not seeing any meaningful shifts in drilling or completion activity.

Speaker Change: In the natural gas pipeline segment, our assets remain well positioned to benefit from increasing natural gas demand.

Sheridan Swords: In the natural gas pipeline segment, our assets remain well positioned to benefit from increasing natural gas demand. We've been engaged in active negotiations across our system related to power demand for data centers in Oklahoma and Texas, as well as LNG, ammonia, and industrial demand along the Mississippi River industrial. Our Oklahoma natural gas storage expansion project was recently completed and will be fully in service next month, adding an additional four BCF of working storage capacity, which is 80% committed with third-party companies. We're also underway on our Jefferson Island Storage Hub expansion project in Louisiana. which will increase storage capacity by approximately 8.5 BCF and will be completed in two phases with the first expected in 2028 and the second in 2029.

Speaker Change: We've been engaged in active negotiations across our system related power demand for data centers in Oklahoma and Texas.

Speaker Change: As well as LNG ammonia and in industrial demand along the Mississippi River industrial work.

Speaker Change: Our Oklahoma natural gas storage expansion project was recently completed and will be fully in service next month.

Speaker Change: I think an additional four bcf of working storage capacity.

Speaker Change: She is 80% committed with third party contracts.

Speaker Change: We are also underway on our Jefferson Islands storage hub expansion project in Louisiana.

Speaker Change: Which will increase storage capacity by approximately eight five Bcf and we will completely completed two phases with the first expected in 2028 and the second in 2029 <unk>.

Sheridan Swords: This project is fully subscribed by third party.

Speaker Change: This project is fully subscribed by third party commitments.

Pierce Norton: Pierce that concludes my remarks.

Pierce Norton: Pierce, that concludes my Thank you, Sheridan and Walt. As we close today's call, I want to acknowledge the dynamic environment we're operating Despite the external noise. Long-term fundamentals of our business remain strong, and we're well-positioned for continued growth. Ultimately, the strength of our integrated assets, our understanding of the markets we serve, and our proven ability to adapt. give us confidence in the durability of our outlook. What gives me additional confidence is our people. Dedication and Innovation of our Employees. are the driving force behind everything that we accomplish. Their unwavering commitment to safety, innovation, and operational excellence continues to position One Oak for long-term success.

Speaker Change: Thank you Sharon.

Speaker Change: As we close today's call I want to acknowledge the dynamic environment, we're operating in.

Speaker Change: Despite the external noise.

Speaker Change: Long term fundamentals of our business remains strong and we're well positioned for continued growth.

Ultimately the strength of our integrated assets, our understanding of the markets we serve.

Speaker Change: And our proven ability to adapt.

Speaker Change: Give us confidence in the durability of our outlook.

Speaker Change: What gives me additional confidence is our people.

Speaker Change: Dedication and innovation of our employees are the driving force behind everything that we accomplish their unwavering commitment to safety innovation and operational excellence continues to position one of our long term success, we remain focused on optimizing our existing assets expanding.

Pierce Norton: We remain focused on optimizing our existing assets.

Pierce Norton: expanding strategically in high growth areas like the Permian Basin and leveraging our integrated footprint to meet the rising demand for midstream infrastructure here in the United States.

Speaker Change: Typically in high growth areas like the Permian basin, and leveraging our integrated footprint to meet the rising demand for midstream infrastructure here in the United States.

Unknown Executive: Operator are now ready for questions.

Speaker Change: Operator, we're now ready for questions.

Speaker Change: And ladies and gentlemen, we will now begin our question and answer session to ask a question you May Press Star and then one you are using a speaker phone. We do ask you. Please pick up the handset before pressing the keys to.

Unknown Executive: And ladies and gentlemen, we will now begin that question and answer session. To ask a question, you may press star and then one. You are using a speakerphone. We do ask that you please pick up the handset before pressing the button. To withdraw your questions, you may press star and two.

Speaker Change: So withdraw your question you May press Star two.

Unknown Executive: At this time, we will pause momentarily to assemble the roster.

Speaker Change: At this time, we will pause momentarily to assemble the roster.

Speaker Change: Our first question today comes from Jeremy Tonet from Jpmorgan. Please go ahead with your question.

Jeremy Tonet: Our first question today comes from Jeremy Tonet from J.P. Morgan. Please go ahead with your question. Hi, good morning. Morning, Jeremy. Thanks for the caller on the call today.

Jeremy Tonet: Hi, good morning.

Jamie: Morning, Jamie.

Speaker Change: Thanks for the color on the call today I was wondering if you might be able to expand a little bit more on the synergies and I guess the forward outlook, there's a lot of uncertainty in the market but.

Pierce Norton: I was wondering if you might be able to expand a little bit more on the synergies and I guess the forward outlook. There's a lot of uncertainty in the market, but from what you see right now, you know, for the balance of 25, not really just hitting the guy there, but really, you know, what the commentary on 2026 appears unchanged as far as strong growth there. And just wondering if you could elaborate a bit more maybe on what you see there, you know, synergy capture that that gives you the confidence to stick with that.

Jamie: From what you see right now.

Jamie: For the balance of 25, not really just hitting the guy there, but really the commentary on 2026 appears unchanged as far as strong growth there and just wondering if you could elaborate a bit more maybe on what you see there you know synergy capture that that gives you the confidence to stick with that at this point.

Speaker Change: Well I'll start chairman and I'll, let Sheridan and <unk> fill in but.

Pierce Norton: Well, I'll start, Jeremy, and then I'll let Sheridan and Walt fill in. But, you know, with what we're looking at with the LNG exports, all the construction that's going on in the Gulf Coast, adding as much as 10 BCF in the next five years with AI data centers, you know, increasing probably anywhere from 3 BCF a day to 8 BCF a day. We understand where those opportunities are, and many of them are in our areas. And so there's some drivers out there that are kind of outside some of the economics, you know, and the macroeconomics.

Jamie: With what we're looking at with LNG exports.

Jamie: All the all the construction that's going on in the Gulf Coast, adding as much as 10 Bcf in the next five years with AI data centers, increasing probably anywhere from three Bcf a day to a Bcf a day, we understand where those opportunities are and many of them are in our areas.

Jamie: So theres some drivers out there that are kind of outside of some of the some of the economics.

Jamie: And the macroeconomics.

Sheridan Swords: So I think that, you know, the global demand for LNG and LPGs, we think is going to continue. And so far, everybody that we talked to hasn't given us any indication to material deviate from that. Jeremy, the other thing I would add is a lot of our Synergy projects are not dependent on volume. We have a lot of projects where we are becoming more efficient at blending normal butane and refined products as we connect our NGL infrastructure to our refined product and infrastructure both in the Gulf Coast with our Eastern Acquisition and that coming on later this year and in the Mid-Continent.

Jamie: I think that.

Jamie: The global demand for LNG and LPG <unk>, we think is going to continue and so far everybody that we talk to hasn't given us any indication to materially deviate from that.

Speaker Change: Jeremy the other thing I would add is a lot of our synergy projects are not dependent on volumes. We have a lot of projects, where we are becoming more efficient at up letting normal butane refined products as we connect our NGL infrastructure into our byproducts infrastructure both in the Gulf Coast with our eastern acquisition at that coming on later this year.

Speaker Change: And in the mid continent, there are going to be driven by demand on our refined product system as we see volume or prices go down all of our crude oil at rather commodities, we actually see demand come up on our refined product system. So that is in.

Sheridan Swords: They are going to be driven by demand on the refined product system. As we see volume, our prices go down for crude oil and for other commodities, we actually see demand come up on the refined product system. So that is independent of the price environment we continue to see. And then some of our Synergies that we're looking at or Synergies we're looking at like in the Mid-Top and in the Gathering Processing, they are efficiency Synergies that we are going to get even at this volume level. We're going to get it as we move gas to more efficient processing plants that produce more NGLs.

Speaker Change: Independent of that.

Speaker Change: The price environment, we continue to see and then some of our synergies that we're looking at our synergies. We're looking at like in the mid top gathering processing. They were efficiency synergies that we're going to get even at this volume level, we're going to get it as we move gas to more efficient processing plants that produce more ngls and also in in.

Walter Hulse: And also in the Army on our crude gathering systems where we're going to be able to, as we continue to fill that capacity, we'll be able to put more of that crude oil on our long-haul pipes and that's crude oil already on our system. So that's what gives us in any environment, any pricing environment, gives us confidence in what the Synergies are. Jeremy, the only thing I would add to that is that we do continue to see procurement opportunities. Our increased buying is going to continue to give us opportunities to lower costs as we see contracts roll off various services here over the course of the next several years.

Speaker Change: The Permian on our crude gathering systems, where we're going to be able to as we continue to build that capacity will be able to put more of that crude oil on our long haul pipes that crude oil already on our system. So that's what gives us in any environment any pricing environment gives us confidence that with the synergies we have.

Speaker Change: In Germany, the only thing I would add to that is that we do continue to see procurement opportunities are increased by just going to continue to give us opportunities to lower costs as we see.

Speaker Change: So the contracts roll off for various services zero over the course of the next several years so.

Jeremy Tonet: So we're focused on making sure that we capture those. Got it. That's helpful. Thank you.

Speaker Change: We're focused on making sure that we capture dose as well.

Speaker Change: Got it that's helpful. Thank you and then maybe just shifting a little bit to producer conversations here. We've seen reports of producers asking for meaningful concessions from mid streamers, and just wondering I guess, how your producer.

Jeremy Tonet: And then maybe just shifting a little bit to producer conversations here. We've seen reports of producers asking for meaningful concessions from midstreamers and just wondering, I guess, how your producer-customer conversations go with regards to that. And I guess, could there be the potential for win-win solutions or just any color there?

Speaker Change: Producer customer conversations go with regards to that and I guess could be the potential for win win solutions or just any color there would be great.

Speaker Change: So I'll, let me start with this one too Jeremy and I'll throw it to Sheraton, but.

Pierce Norton: So I'll, let me start with this one too, Jeremy, and I'll throw it to Sheridan. But you know, I've had the opportunity to have some discussions with mainly the other service providers that actually service the well drilling and the production completion, and when we talk to them, you know, that's where I think the E&P companies are kind of focused on first, because those are more, you know, in line with what's going to happen immediately with drilling and the completion of the wells.

Speaker Change: Had the.

Speaker Change: Opportunity to have some discussions.

Speaker Change: With mainly the other service providers.

Speaker Change: Actually serve as well.

Speaker Change: Drilling and the production completion.

Speaker Change: And when we talk to them, that's where I think the the.

Speaker Change: E&P companies are kind of focused on first.

Speaker Change: Because those are more in line with what's going to happen immediately we're drilling in.

Speaker Change: And the completion of the wells. So I think that's probably one of their first <unk>.

Sheridan Swords: So I think that's probably one of their first focus areas, and I'll let Sheridan kind of talk to you about, you know, recontracting or whatever on these contracts. Jeremy, what I would say in any environment, when our contracts come up with our producers, we are always looking for areas that we have win-win, and that's the whole bundling aspect that we have touted in some of these Synergy projects or what we do in bringing other, these other acquisitions in there. What we're looking at, where can we add value to them and where can they add value to us?

Speaker Change: First focus areas and I'll, let Sheridan kind of talk to you about about re contracting or whatever on these contracts Jeremy what I would say in any environment in our contracts come up with our producers. We are always looking for areas that we have planned plant and that's the whole bundling aspect that we have talented and somebody said synergy projects are what we do.

Speaker Change: Bringing these other acquisitions that we're looking at where can we add value to them that where can they add value to us. It's a very constructive conversation those conversations that are going on right now or no different that have made going on for a period of time and our indications from our customers as they still see value in what we bring to them.

Jeremy Tonet: It's a very constructive conversation. Those conversations that are going on right now are no different than have been going on for a period of time, and our indications from our customers is they still see value in what we bring to them. in different areas, and they were looking for that to stretch across the whole value chain. So it really fits into what we're trying to do with these acquisitions with our bundling strategy. Got it. That's helpful.

Speaker Change: In different areas and they were they were looking for that that stretch across the whole value chain. So it's really it really fits into what we're trying to do with these acquisitions with our bundling strategy.

Speaker Change: Got it that's helpful I'll leave it there thanks.

Jeremy Tonet: I'll leave it there. Thanks.

Speaker Change: Yeah.

Speaker Change: Our next question comes from Spiro <unk> from Citi. Please ask your question.

Spiro Dounis: Our next question comes from Spiro Dounis from Citi. Please go ahead with your question.

Speaker Change: Hi, this is Doug or Owen on for Sarah.

Sheridan Swords: Hey, this is Doug Irwin on for Spiro. Maybe just to start with the LPG export project. Just curious if and how the potential for tariffs on LPGs has impacted your approach for commercializing this project moving forward.

Speaker Change: Maybe just to start with the LPG export projects I'm, just curious if and how the potential for tariffs on LPG. So it's impacted your approach for commercializing this project going forward.

Sheridan: Yeah. This is sheridan at it it is not really impacted our project at all.

Sheridan Swords: This is Sheridan. It has not really impacted our project at all, or even our contracting approach. One thing you got to look at with LPGs, as we've said many times, it is a byproduct. It needs to clear to the international market. It will make it happen. As you've seen, even as prices have moved up and down, or threats and terror, you've seen our LPG exports be fairly steady for that period of time. There's no increased demand in domestic growth. So all that has to be exported, and that product needs to clear to be able to continue to get the gas and the crude oil out of the basin.

Sheridan: Or even our contracting approach one thing you got to look at with LPG is as we've said many times. It is a byproduct it needs to clear to the international market. It will make it happen as you see in even as prices have moved up and down or or threats of tariff <unk> seen our LPG.

Sheridan: LPG exports be fairly steady for that period of time, but theres no increased demand and domestic growth. So all of that has to be exported and that product needs to clear to be able to continue to get the gas and that crude oil out of the basin. So we have not seen any impact to LPG exports or any change in our conference.

Spiro Dounis: So we have not seen any impact to LPG exports, nor any change in our contract to stretch. Okay, great. That's helpful.

Sheridan: <unk>.

Speaker Change: Okay, Great. That's helpful and my follow up maybe just on the macro environment.

Sheridan Swords: And my follow up maybe just on the macro environment. I'm just curious if we see crew to go into a steep contango here, how should we think about potential storage tailwinds across your system? Yeah, we have a lot of crude oil storage across our system. And we would have into a contango market, we would have great opportunity to be able to store that product in the front month and be able to sell it out for out forward. So yeah, there would be on that aspect by itself, we would have some tail ends with storage, if you went to a contango with our on system storage.

Speaker Change: I'm just curious if we see crude to go onto a steep contango here, how should we think about potential storage talents across your system.

Speaker Change: Yeah, we we have a lot of crude oil storage.

Across our system and we would have into a contango market, we would have great opportunity to be able to store that product and the front month to be able to sell it out outboard. So yeah. There would be on that aspect by itself. We would have some tailwind with the storage. If you went to a contango with our on system storage.

Speaker Change: Yeah.

Speaker Change: Great I'll leave it there.

Spiro Dounis: Great, I'll leave it there.

Unknown Executive: Thank you.

Speaker Change: Thanks.

Speaker Change: Our next question comes from Theresa Chen from Barclays. Please go ahead with your question.

Theresa Chen: Our next question comes from Theresa Chen from Barclays. Please go ahead with your question. Morning.

Theresa Chen: Good morning, well I wanted to go back at your comments about protecting the balance sheet and defend as further macro deterioration and what are your capex plans in place for the near to medium term how much can you flex down if things get worse.

Pierce Norton: Well, I wanted to go back to your comments about protecting the balance sheet in the event of further macro deterioration. With your CapEx plans in place for the near to medium term, how much can you flex down if things get Well, Theresa, I would say that, you know, we've lived that scenario a couple of times over the last 10 years. Clearly, that was something that had to take place in 2020. And I think we demonstrated a very significant ability to flex our capital program. Clearly, your routine growth, which is often, you know, driven by producer activity, will come off kind of naturally.

Theresa Chen: Theresa I would say that we've looked at that.

Theresa Chen: Scenario, a couple of times over the last 10 years.

Theresa Chen: Clearly that was something that had to take place in 2020, and I think we demonstrated a very significant ability to.

Theresa Chen: Flex are.

Theresa Chen: Capital program clearly you're.

Theresa Chen: Routine growth, which is often driven by producer activity will come off kind of naturally if activity slows we won't be spending a portion of it that's about $1 billion of our annual capital that can be flexed.

Pierce Norton: If activity slows, we won't be spending that portion. And that's about a billion dollars of our annual capital that can be flexed. And then the longer term, larger projects, you know, as in 2020, we actually put some of those on hold and then spent the money to do that properly so that as the market came back, we were able to restart those projects and meet our customer demand. You know, we will look at across all of our projects, those that are critical to continuing to deliver on the plan will be executed, you know, in due course.

Theresa Chen: And then the longer term larger projects.

Theresa Chen: As in 2020, we actually put some of those on hold and then.

Theresa Chen: The money to do that properly so that as the margin came back we were able to restart those projects.

Theresa Chen: Our customer demand.

Sure.

Theresa Chen: We will look at across all of our projects those that are critical to continuing to deliver on the plan will be executed in.

Theresa Chen: In due course.

Pierce Norton: So, we look at everything today.

Theresa Chen: So we looked at everything today, we don't see that.

Pierce Norton: We don't see an environment where that's necessary, but we did want to highlight that we did it back in 2016. We did it in 2020. So, if we see a macro outlook or global demand destruction, we're in a position to know how to manage the balance sheet and protect it as we've done in the past. Thank you.

Theresa Chen: In an environment, where that's necessary.

Theresa Chen: But we did want to highlight that we did it back in 2016, because in 2020. So if we see a macro outlook for global demand destruction. We're in a position to know how to manage the balance sheet and the protected.

As we've done in the past.

Theresa Chen: Thank you.

Sheridan Swords: And On the subject of synergies and 2025 guidance, Sheridan, I know you gave a lot of, you know, very interesting color on why things are second-half weighted and the different streams of income, incremental earnings that will come to fruition. At this juncture, how much would you say is already underway now that we're through April, or is there still a significant component that is still subject to execution either by one or by a producer for the remainder of the year? What I would say is a substantial amount of the synergies we have in 2025 are underway in one form or the other.

Speaker Change: On the subject of synergies and the 2025 guidance Sheridan I know you gave a lot of very interesting color on why things are second half weighted and the different streams of income and incremental earnings that will come to fruition at this juncture.

Speaker Change: Would you say is already under way now that we're through April or if there is.

Still a significant component that is still subject to execution either by one of our corporate <unk> for the remainder of the here.

Speaker Change: But I would take a substantial amount of the synergies we have in 2025 are underway in one form or the other eight millwork route and to do so.

Sheridan Swords: You know, we're having to do some. little bit of capital projects, especially with some of the in-link and medallion. We need to connect the two systems together. They're being connected. That takes a little bit of time to do that. It can't happen overnight. And then some of the, obviously, we've already touted some of the synergies that are being, from the Magellan acquisition in 2023, that we have already said that it was going to take a little bit more capital build. And we'd be bringing them on in mid-point in 2026. And I mentioned those, the ones down on the Gulf Coast, we're tying the product system.

Speaker Change: A little bit of capital project, especially with some of the Enlink and medallion, we need to connect the two systems together, they're being connected that takes a little bit of time to do that can't happen overnight.

Speaker Change: And then some of the obviously, we've already counted some of the synergies that are being <unk>.

Speaker Change: From the Magellan acquisition in 2023 that we have already said that it was going to take a little bit more capital build enabling we bring them on in mid 2026 that I mentioned those are the ones down on the Gulf Coast were tied the NGL system into the for byproducts system, that's going to be that later second half of this year. That's a project we've been working on for a little over.

Sheridan Swords: That's going to be done later, second half of this year. That's a project we've been working on for a little over a year. That's going to have a pretty big impact. And also tying in the InGEL system and MidContinent. Those things are all underway. That's where we're going to get a lot of it going forward. And that's why we get confidence. There's still, obviously, we have other ones that we continue to find. And as we get the two systems together that we're adding to the list that we may also see some later coming on later this year.

Speaker Change: A year, that's kind of a pretty big impact and also tying it in the NGL system at the mid call. It those extra all underway. That's we're going to get a lot of it going forward and Thats why we get confidence they're still obviously, we have other ones that we continue to find as we get the two systems together that we're adding to the list that we may also see some later coming on later this.

Speaker Change: This year as.

Sheridan Swords: we go forward. But we're very, we have a high amount, high degree of confidence.

Speaker Change: As we go forward, but we're very we have a high about high degree of confidence that our synergies for 2025, and Teresa vis vis peers don't have that.

Pierce Norton: Theresa, this is Pierce. The only thing that I would add to that is when we did the Magellan acquisition and even in Lincoln Medallion, one of the things that's common to all three is synergies are in our control. When we talked about batching, blending, bundling, those are all things that we have control of and we're not waiting on a contract to be signed or buying to show up. It's mainly interconnects that we have to make, but it takes, like Sheridan said, it takes time to make those interconnects and then we're continuing to do those throughout the year.

Speaker Change: I would add.

Speaker Change: As well.

Speaker Change: When we did the Magellan acquisition, and even Enlink and medallion one of the things that's common to all three is the synergies are in our control.

Speaker Change: When we talked about batching and blending bundling those are all things that we have control of that we're not waiting on a contract to be signed or even show up it's mainly interconnects that we have to make but it takes like Sheridan said it takes time to make those interconnects and that we're continuing to do those throughout the year.

Pierce Norton: But the majority of these things are definitely within our control. And the thing that I would add to that, Theresa, is that, you know, we've only now operated fully controlling the in-link system since February 1, effectively. You know, as we've looked at some of our cost opportunities, I'll give you an example. Property insurance, you know, there was a scenario where we were able to add the in-link business and the dahlia business to our program and pretty much save close to 100% of the cost that those two entities were spending in the past. That all started on April 1.

Speaker Change: The majority of these things are definitely within our control.

Speaker Change: And the thing that I would add to that too soon is that we've only now operated fully controlling the enlink system since.

Speaker Change: February one effectively.

Speaker Change: And as we've looked at some of our cost opportunities I'll give you an example proper.

Speaker Change: Property insurance there was.

Speaker Change: A scenario, where we were able to as the <unk> business.

Speaker Change: The Italian business to our program and pretty much say close to a 100% of the cost that those two entities, where we're spending asked that all started on April one so you'll start to see those things roll in as we look at various others expenditures, where we're able to consolidate we pick those up at the <unk>.

Pierce Norton: So, you start to see those things roll in, and as we look at various other expenditures where we're able to consolidate, we pick those up at the point in time that those new contracts start. So, that'll start to fold in throughout the year as we move forward.

Speaker Change: Point in time that those new contracts start so that'll start to fold in throughout the year as we as we move forward.

Speaker Change: Thank you.

Unknown Executive: Thank you.

Speaker Change: Yes.

Speaker Change: Our next question comes from Michael Blum from Wells Fargo. Please go ahead with your question.

Michael Blum: Our next question comes from Michael Blum from Wells Fargo.

Sheridan Swords: Please go ahead with your question. Thanks. Good morning, everyone. I had a couple of questions on the BACN. Obviously, you know, the data shows some recovery in volumes, but you're not quite Wildfire Levels.

Michael Blum: Thanks, Good morning, everyone.

Michael Blum: I had a couple of questions on the on the Bakken.

Michael Blum: Obviously, you know the data show some recovery in volumes, but you're not quite back to pre wildfire.

Michael Blum: Wildfire level. So I'm, just wondering how you're seeing the rest of the year trending and I recognize now that Bakken is a smaller piece of the overall pie, but how much Bakken growth do you need to hit your full year guidance.

Sheridan Swords: So just wondering how you're seeing the rest of the year trending, and I recognize now that Bakken is a smaller piece of the overall pie, but how much Bakken growth do you need Michael, this is Sheridan. As we said before, we just need a small, low, single-digit growth to meet our guidance, and everything is pointing that we will definitely be there. If not exceed that number, it is looking good at this time. As we go forward, a lot's going to tell us we're seeing good, and what gives us a lot of confidence is we're coming strong out of the winter, even though it's April in a lot of places, it's full spring.

Sheridan: Well Michael This is Sheridan, we as we said before we just need a small low single digit growth that beat our guidance and everything is pointing to that that we will definitely be there.

Sheridan: If not exceed that number it is looking good at this time as we go for the law is going to tell us we're seeing good and what gives US a lot of confidence as we're coming strong out of the winter even though its April a lot of places the skull spring. It's just early spring in the Bakken.

Sheridan Swords: It's just early spring in the bucket as we continue to go forward. So, we get into May, also, we'll see how we anticipate even more will be coming out due to winter issues, and that will give us a great momentum into the rest of the year, and that's what gives us really our confidence of what our volume for the year is going to be. And that's the way it is every year. Every year, we kind of need to wait until we come out of winter and what it looks like going forward, and when we start getting able to see that, that's where we get our confidence, where we're comfortable, where we're sitting.

Sheridan: As we continue to go forward. So we get into May also we will see how we anticipate even more will be coming out good winter winter issues that that will give us a great momentum into the rest of the year and that's what gives us really our confidence what are.

Sheridan: Volume for the year as can be and that's why it is every year every year, we kind of need to wait till we come out of winter and what it looks like going forward and when we start to get out and see that that's that's where we get our confidence we are comparable where we're sitting.

Speaker Change: Okay. Thanks for that charter and then.

Michael Blum: Okay, thanks for that, Sheridan.

Sheridan Swords: And then, as I think about FN recovery in the Bakken, how sensitive is that to market pricing? So, like, if we see a prolonged China week. that have an impact, or is it really just the ethane that's getting recovered there? Is it really just a heat rate concern on the northern border, and it's not really driven by pricing? Thanks. You know, really, right now, what we're doing is more affected by pricing, because we've had a price level that's in there that it says that we want to recover the ethane and be able to capture the natural gas spread in the Bakken to ethane in Mont Belvieu.

Sheridan: As I think about ethane recovery in the Bakken.

Sheridan: How sensitive is that to market pricing. So like if we see a prolonged China weakness for example would that have an impact or is it really just the ethane that's getting recovered there because it really is just a heat rate concern on northern border and it's not really driven by pricing.

Sheridan: Yeah.

Sheridan: Really right now what we're doing is more affected by pricing because we've had a price level. That's in there that it says that we want to recover the ethane to be able to capture the natural gas spread in the Bakken to ethane at Mont Belvieu.

Sheridan Swords: If we would have a complete full rejection, you would probably end up getting into a heat rate on some of that volume on northern border right now. But obviously, if there's a downturn on ethane to gas prices in Mont Belvieu, we'll have a little bit of an effect on that. But then we can pull that volume back off, which pulls it off of the market, which helps the market a little bit, and put it into northern border if we have to. And that's why we like about that ethane play that we have up there. We're very flexible when we bring it in, when we don't bring it in, and what value we have.

Sheridan: If we would have a complete full rejection.

Sheridan: They end up getting into a heat rate on some of that volume on northern border right now, but obviously, if there's a downturn on an ethane to gas prices and Mont Belvieu will have a little bit of evidence back on that but then we can pull that volume back office pulls it off of the market would help the market a little bit but it did into northern border, we're happy and that's why we like about that.

Sheridan: Ethane claim that we have up there we're very flexible when we bring it in when we don't break it in and what value. We have now we have been able to do as we look forward, we've been able to lock some of that is already so we already have some of that already pre locked in so even if we add some changes we'd still be able to cover.

Sheridan Swords: Now, we have been able to, as we look forward, we've been able to lock some of that in already. So we already have some of that already pre-locked in. So even if we had some changes, we'd still be able to recover a portion of that volume that we think we needed to. But as you heard today, you know, they are, as we think about China and that macro, you've already seen that they're trying to relax the tariffs on ethane going into their crackers over there because they, frankly, they need the United States ethane. That's what it's been running on there.

Sheridan: So that volume we needed to.

Sheridan: As you incurred today you know they are as we think about China and is that macro you've already seen that tried.

Sheridan: Try to relax the tariffs on I think going into their crackers over there because frankly, they need in the United States. That's what it's been running on there they're getting directly from our side. So I think we're going to continue to see the demand for ethane at the China for the rest of the rest of the year.

Sheridan Swords: They're getting it directly from our side. So I think we're going to continue to see the demand for ethane out of China for the rest of the year.

Sheridan: Okay.

Sheridan: Thank you.

Sheridan: Our next question comes from Ian Salisbury from Bank of America. Please go ahead with your question Hi, Good morning, and I just have one and it's kind of a follow on to Michael's and NGL volumes seen light across the board in the first quarter. So I really appreciate it sheraton's discussions around how it compared to your internal projection.

Jean Salisbury: Our next question comes from Jean Salisbury from Bank of America. Please go ahead with your question. Hi, good morning. I just have one. It's kind of a follow on to Michael's. You know, NGL volumes seemed light across the board in the first quarter. So I really appreciated Sheridan's discussions around how it compared to your internal projections, and how things are ticking up in April on the NGL volume front. I did just want to ask if there was more ethane rejection in the mid-con or Bakken or anything like that, than you had sort of anticipated, which would potentially impact the rest of the year?

Sheridan: And how things are picking up in April and the NGL volume Bryan and I just wanted to ask if there was more ethane rejection in the mid con or Bakken or anything like that then you had sort of anticipated, which would potentially impact the rest of the air or if that is it's basically kind of what you had already forecast for the first quarter.

Sheridan Swords: Or if that is, is basically kind of what you had already forecast for the first quarter?

Sheridan Swords: Well, what I would say is it's what we had anticipated for the fourth quarter because when we gave you our guidance at the end of February we already had two months in the book so we had a very good idea what the first quarter was going to look like. Yeah, so the amount of ethane rejection in the first quarter across our entire system is right in line with what we expected it or what we put into our guides because we knew what it was going to be. As we are, as obviously we're in more ethane recovery now as we typically do in the summer months when gas prices go down and we don't see as much the high price on gas prices related to the other commodities.

Sheridan: Well, what I would say is it's what we had anticipated for the fourth quarter because when we gave you our guidance at the end of February we already had two months in the books. So we had a very good idea of what the first quarter was going to look like yeah. So the amount of ethane rejection.

Sheridan: In the first quarter across our entire system is right in line with what we expected or what we put into our guidance because we knew what it was about eight.

Sheridan: We are as obviously, we're seeing more ethane recovery now as we typically do in the summer months when gas prices go down and we don't see that as.

Sheridan: As much the high price on gas prices related to the other commodities and so ethane recovery across the board is up on our system and we anticipate that's going to be throughout the year and we still have the same point of view on ethane.

Sheridan Swords: And so ethane recovery across the board is up on our system and we anticipate that's going to be throughout the year and we still have the same point of view on ethane that we had almost every year is that the Permian for the most part is going to be a complete ethane recovery. Sometimes it changes but it's going to be a complete ethane recovery. The Mid profit is going to be in and out at different times. and then the Rockies is going to notionally be out unless we... want to bring some in to capture that ethane, that natural gas to ethane spread, which we have predominantly done throughout.

Sheridan: That we've had almost every year is that the Permian for the most part is going to be incomplete ethane recovery, sometimes it changes, but just can be completed after recoveries. The mid comp that's going to be in and out on at different times.

Sheridan: And then the Permian.

Sheridan: Rockies has gone to notionally be al unless we.

Sheridan: I want to bring some magic capture that ethane that that natural gas do you think spread which we have periodically done throughout the year.

Jean Salisbury: Okay, great. That's all for me.

Sheridan: Okay, Great. That's all for me Thank you Shannon.

Sheridan Swords: Thank you, Sheridan.

Sheridan: Okay.

Speaker Change: Our next question comes from Manav Gupta from UBS. Please go ahead with your questions.

Manav Gupta: Our next question comes from Manav Gupta from UBS. Please go ahead with your question.

Manav Gupta: Hi guys, I actually just wanted to focus on slide five, very interesting slide, but some of us are slightly visually challenged. So help us understand the slide a little better. Are you trying to imply that by combining these four companies, there is about additional 1.3 billion of incremental EBITDA realizable by 2027? Can you help us walk through this slide? There's a lot of very good information on here. Yes, I mean, that's exactly the the punch line there as you get out into 2027. What we wanted to do is, you know, go back and give a base.

Manav Gupta: Hi, guys I actually just wanted to focus on slide five very interesting set of flight, but some of US slightly recently challenged so help us understand the slide a little bit better are you trying to imply that by combining these four companies that are just about at least started $1 3 billion of incremental EBITDA realizable by 2027.

Speaker Change: Help us walk through the slides, there's a lot of very good information on here.

Speaker Change: Yes.

Speaker Change: Yes, that's exactly the.

Speaker Change: The punch line there as you get out into 2027.

Speaker Change: What we wanted to do was go back and give a base. So if you look at the <unk>.

Walter Hulse: So if you look at the projections that were there at the time of the acquisitions, and then we layer in the synergies and growth projects, and we wanted to put both of those in because a great example of that is the refined products pipeline expansion out to Denver. You know, is that a synergy? Or is that really, you know, a growth opportunity that presented itself as we brought these two companies together? Either way, it's going to be a great contributor as we look going forward. So we wanted to couple those together, and show you how that would build over time.

Speaker Change: Rejections that were there at.

Speaker Change: At the time of the acquisitions and then we layer in the synergies and growth projects and we wanted to put both of those and a great example of that is the refined products pipeline expansion out of Denver.

Speaker Change: Is that a synergy or is that really a growth opportunity that presented itself as we brought these two companies together.

Speaker Change: Either way, it's going to be a great contributor as we look going forward.

Speaker Change: So we wanted to couple those together.

Speaker Change: Show you how that will build over time, because as Sheridan spend time, you talk Jim today, We're just now getting in a position to get some of those Magellan synergies, where we had to spend some capital to connected system and.

Walter Hulse: Because as Sheridan spent time here talking today, we're just now getting in a position to get some of those Magellan synergies, where we had to spend some capital to connect the system. And, you know, there will be some of those with M-Link and Medallion. Hopefully, they'll come in a little bit quicker, because they're a little bit smaller in scale as to what needs to happen. But we wanted to give you a view of how we see those playing forward, so that as you think about a longer term growth rate, you can understand what we think some of those opportunities are.

Speaker Change: There will be some of those with Enlink.

Speaker Change: Medallion, hopefully they'll come in a little bit quicker, because they're a little bit smaller in scale as to what needs to happen but.

Speaker Change: But we wanted to give you a view of how we see those playing forward. So that as you think about a longer term growth rate you can understand what we think some of those opportunities are.

Speaker Change: Perfect. My quick follow up here it looks like the weather was working against you in <unk> and I know, it's difficult to quantify but I'm just trying to understand the opportunity cost of the lost revenue or EBITDA. If the weather was not a major headwind as it looks like it was.

Walter Hulse: Perfect.

Walter Hulse: My quick follow-up here is it looks like the weather was working against you in one cue, and I know it's difficult to quantify, but I'm just trying to understand the opportunity cost or the lost revenue or EBITDA if the weather was not a major headwind as it looks like it was in the first quarter. Well, I think that clearly, if we hadn't had the weather, there would have been an opportunity for more Yuvita. But I would say that no matter what happens, you're always going to have weather in North Dakota in the first quarter. So, you know, we clearly plan for that.

Speaker Change: In the first quarter.

Speaker Change: Okay.

Speaker Change: Yeah.

Speaker Change: Well.

Speaker Change: I think that clearly if we hadn't had the weather.

Speaker Change: There would have been an opportunity for more EBITDA, but I would say that no matter what happens you're always going to have weather in North Dakota.

Speaker Change: The first quarter. So we clearly plan for that and that is part of our expectations. When we do our forecasting.

Walter Hulse: And that is part of our expectations when we do our forecasting. You know, in the very few periods where we've had some weather up there, we surely have taken advantage of it and made some good money in those opportunities. But by and large, we're going to be impacted by weather every first quarter, and then we get a little bit of it back there in the fourth quarter as well. So, We really look at how we come out of that in the spring and jump forward into the second and third quarter where we really get to see the uplift in the Bakken activity.

Speaker Change: In the very few periods, where we've had some warmer weather up there.

Surely you've taken advantage of it.

Speaker Change: And made some.

Speaker Change: Some good money on those opportunities, but by and large we're going to be impacted by weather every first quarter.

Speaker Change: We get a little bit of it.

Speaker Change: They're in the fourth quarter as well.

Speaker Change: So.

Speaker Change: We really look at how we come out of that.

Speaker Change: In the spring and jumped forward into the second and third quarter, where we really get to see the uplift in.

Speaker Change: The Bakken activity.

Walter Hulse: Thank you so much.

Speaker Change: Thank you so much.

Speaker Change: Our next question comes from Keith Stanley from Wolfe Research. Please go ahead with your question.

Keith Stanley: Our next question comes from Keith Stanley from Wolf Research.

Keith Stanley: Please go ahead with your question. Hi, good morning. So you've had a lot of confidence on the call on the 2025 outlook. Good details on recovery this spring. Would you say even with Q1 that as of now, you're still tracking to the midpoint of the 2025 EBITDA guidance generally? Yeah, I would say that we reaffirmed guidance just as we gave it in February with the same vision of where we would end up. We are in line, affirming financial guidance as it was given.

Keith Stanley: Hi, good morning.

Keith Stanley: So you've had a lot of confidence on on the call on the 2025 outlook.

Keith Stanley: Good details on recovery. This spring would you say, even with Q1 that as of now you are still tracking to the midpoint of the 2025 EBITDA guidance generally.

Keith Stanley: Yes, I would say that we reaffirmed guidance just as we gave it in February.

Keith Stanley: The same where we would.

Keith Stanley: And so.

Keith Stanley:

Keith Stanley: We are in line.

Keith Stanley: Affirming financial guidance as it was given in February.

Keith Stanley: Okay great.

Pierce Norton: Great.

Walter Hulse: I had another follow up on slide five, and I want to just make sure I'm understanding the data point for 2027. So you're pointing to 870 million of synergies and growth uplifts in 26, and then 1.3 billion in 27. So that's over $400 million of year-over-year upside in 2027. And, you know, I think that's on top of growth in the stand-alone business outlooks as well. I just want to make sure I'm understanding that right as far as the upside you see in 2027. Yeah, and I think that that's an example, that's a good, you know, highlight of where we start to see some of the stair-step functions when we bring on new projects from a growth standpoint.

Speaker Change: I had another follow up on slide five and I want to just make sure I'm understanding that data point for 2027.

Keith Stanley: So.

Keith Stanley: Youre pointing to $870 million of synergies and growth uplifts in 'twenty, six and then $1 3 billion and 27, so that that's over $400 million of year over year upside in 2027, and you know I think that's on top of growth in the Standalone business outlooks as well I just want make sure I'm understanding.

Keith Stanley: That right as far as the upside you see in 'twenty seven.

Keith Stanley: Yeah, and I think that that's an exam that's of goods.

Keith Stanley: Highlighted where we start to see some of the stairs.

Keith Stanley: Stair step functions when we bring on new projects from a growth standpoint, and why we wanted to highlight the best both synergies, which may be a little bit more linear and then when you are at in gross projects.

Walter Hulse: And why we wanted to highlight that that's both synergies, which may be a little bit more linear, and then when you add in growth projects, they tend to be lumpier and stair-step you up when you bring that on and can start to do less. So clearly as we move from 26 to 27, we'll be bringing on some projects that are underway right now and enjoy the benefit of that 27 and forward.

Keith Stanley: Tend to be Lumpier in stair step you up when you bring that on at the.

Keith Stanley: Start to so clearly as we moved from 26 to 27, we'll be bringing on some some projects that are underway right now and enjoy the benefit of the 27% and forward.

Unknown Executive: Thank you.

Speaker Change: Thank you.

Speaker Change: Our next question comes from a J O'donnell from T. P. H. Please go ahead with your question.

AJ O'Donnell: Our next question comes from AJ O'Donnell from Please go ahead with your question.

Sheridan Swords: Morning, everyone. I just wanted to go back to the Permian volume guidance. Thinking with the current asset footprint and 1.7 BCF capacity, I just wonder if you could elaborate a little bit more about how you envision that volume kind of the cadence stepping up the rest of the year. How much of the volume growth do you think there could be from inefficiencies that you could capture on the system or it's just the volume growth entirely driven by new well connects?

Speaker Change: Good morning, everyone I just wanted to go back to the Permian volume guidance.

Speaker Change: Thinking with the current asset footprint, one seven bcf of capacity.

Speaker Change: Just wondering if you could elaborate a little bit more about how you envision that volume kind of the cadence stepping up the rest of the year.

Speaker Change: How much of the volume growth do you think there could be from inefficiencies that you could capture on the system or it's just the volume growth entirely.

Speaker Change: Driven by new well connects.

Speaker Change: Yes.

Sheridan: Yeah. This is sheridan yeah that volume growth is really going to be more driven by new well connects I mean, we did we.

Sheridan Swords: Yeah, this is Sheridan. Yeah, that volume growth is really going to be more driven by new well connects. I mean, we did not have any. GMP presence in the Permian before we bought the InLink system as we get in there. So what we're seeing now is this overall growth, what's going forward, and I gave you some numbers of where we are today. So that's given us confidence of where we're going to end up. And then we also talked about, we have in the Delaware, we have some quick expansion opportunities out there that are underway now that we can be able to, we're putting in place, we'll be able to absorb some of that as we continue to go forward.

Speaker Change: We did not have any.

Speaker Change: G&P presence in the Permian before we bought the handling system as we get in there. So what we're seeing now is just overall growth was on board and I gave you some numbers of where we are today. So that's given us confidence of where we're going to end up and then we also talked about we have in the in the Delaware we have some quick.

Speaker Change: <unk> opportunities out there that were that are underway now that we can be able to if we're putting in place will be able to absorb some of that as we continue to go forward, but we are seeing the activity level in the Permian as I stated in my remarks that are going to fill our assets have been a lot of it is going to be by the end of the year.

Sheridan Swords: We are seeing the activity level in the Permian, as I stated in my remarks, that are going to fill our assets. And a lot of it's going to be by the end of the year.

Speaker Change: These expansions.

Sheridan Swords: Okay, great. But maybe if I just shift to refined products, I was wondering if you could spend a little bit of time talking about the blending business. Spreads between Butane and RBOB seem to be wider than they were relative to Q4 and I know that there's more that goes into that business such as like logistical costs and differentials.

Speaker Change: Okay, Great and then maybe if I just shift to refined products I was wondering if you could spend a little bit of time talking about the blending business.

Speaker Change: Spreads between butane and our Bob seem to be wider than they were relative to Q4, and I know that there's more that goes into that business, such as like logistical cost and differentials.

Sheridan Swords: I was hoping that maybe you could explain the Q1 results and maybe if we're getting ourselves into a situation like we did in 2024 or like you did in 2024 where you kind of saw a unseasonal uptick in Q2 product margins. Yeah, we, the same strategy that we had in 2024, the spring of 2024 is the same strategy we have going on around 2025, where we saw opportunities to sell to store product and instead of selling in the current month that we blended the product to go ahead and forward sell that in that month out forward into the 2Q and beyond and we will see some added benefit as we get into the second, third quarter from that strategy.

Speaker Change: I was hoping that maybe you could explain the Q1 results and maybe if we're getting ourselves into a situation like we did in 2024 or like you did in 2024, where you kind of saw a.

Speaker Change: On the seasonal uptick.

Speaker Change: In Q2 product margins.

Speaker Change: Yeah, we.

Speaker Change: <unk>.

Speaker Change: The same strategy that we had in 2020 for the spring 2024 is the same strategy, we have going on around that 2020 by where we saw opportunities to.

Speaker Change: You sell to store product and instead of selling in the month that we blended the product to go ahead and forward sell that in that month outward into <unk> and beyond and we will see some added benefit as we get into the second third quarter from that strategy.

Sheridan Swords: I think that's your question. Yeah, that was. Appreciate the color.

Speaker Change: I think that's your question.

Speaker Change: Yeah that was I appreciate the color. Thank you.

Unknown Executive: Thank you.

Speaker Change: Our next question comes from Sunil Sibal from Seaport Global Securities. Please go ahead with your question.

Sunil Sibal: Our next question comes from Sunil Sibal from Seaport Global Securities. Please go ahead with your question. Yeah, hi, good morning, folks. And thanks for all the color on the call.

Sunil Sibal: Yeah, Hi, good morning folks and thanks for all the color on the call. So I just wanted to start off by clarifying some comment which was made in the prepared remarks with regards to the LPG export dock facilities.

Sheridan Swords: So I just wanted to start off by clarifying some comment just made in the prepared remarks with regard to the LPG export doc facilities. So are you indicating that the amount of volumes that you need to fill up your facilities is something that you're already moving on your systems? But I guess with third party export docs, Did I get that right? Yes, we produce enough propane to now to more than fill that dock capacity. Now, we are selling that product into the open market today, whether it be an enterprise, whether it be a target, whether it be an energy transfer.

Sunil Sibal: So are you, indicating that the amount of volumes that you need to fill up your facilities.

Sunil Sibal: It's something that you're already moving onto your systems, but I guess with third party export docks.

Sunil Sibal: Did I get that right.

Sunil Sibal: Yes, we produce enough propane and now the more that still that dock capacity now we are selling that that could put that product into the open market today, whether it be an enterprise whether it be at targa, whether be it in energy transfer and we know just by supply and demand balances.

Sheridan Swords: And we know just by supply and demand balances that some of that product has to be going across their dock, but we are not selling it across their dock. But when our dock comes up, we will take that product that we were selling into the open market that eventually was making it across somebody else's dock. That dock, that product will be shifted away from their docks and be put on our.

Sunil Sibal: Some of that product has to be going across their dock, but we are not selling it across the dock, but when our dock comes up we will take that product that we were selling into the open market that eventually was making it across somebody else's dock. That's all that product will be shifted away from third docs have been put on R&R.

Speaker Change: Understood. Thanks, Thanks, a lot.

Sheridan Swords: Understood. Thanks. Thanks for that.

Sheridan Swords: And then on the gas pipeline business, seems like, you know, you had a pretty solid start, although you had some divestitures in that business. And then you also talked about a few gas storage expansion projects that are kicking in now. So I was curious, you know, when I look at how you performed in the first quarter versus your full year guidance. Am I missing something? You seem to be on a pretty good track to exceed the fully-elevated guidance in that segment. Yeah, I mean, the natural gas pipeline segment has done really well in the first quarter, which typically we see it do well in the first quarter, obviously with heating demand and everything on the system.

Speaker Change: And then on the gas pipeline business seems like a pretty solid start although you had some divestitures in that business.

Speaker Change: And then you also talked about fuel gas storage expansion projects that are kicking in now so I was curious to know when I look at how you performed in the past quarter was our full year guidance.

Speaker Change: Am I missing something that you seem to be a pretty good track to exceed the full.

Speaker Change: Full year EBITDA guidance in that segment.

Speaker Change: Yeah, I've been to the natural gas pipeline segment has done really well in the first quarter, which typically we see it do well in the first quarter, obviously with.

Heating demand and everything on the system and also we see good strength through the rest of the year, we mentioned that we're bringing on.

Sheridan Swords: And also, we see good strength through the rest of the year. We mentioned that we're bringing on, coming up next month, our 4BCF storage that is coming online, that 80% of it's already subscribed, that other 20% will be used for operational storage. Or we need to see an opportunity to do some parking loans out there as well that we've seen from time to time going forward. But you're right, natural gas pipelines is performing well. And then as we look forward, we are, as I mentioned, in some active discussions with some demand, a lot of Louisiana, some of those that are on the industrial corridor, as we said before, that is a really hot area for us that we are on the last stage of getting some demand signed up from industrials out there.

Speaker Change: Up next month or four Bcf of storage, that's coming online that 80% of its already subscribed that other 20% will be used for operational storage or we need to see an opportunity to do some parking loans out there as well that we see from time to time going forward, but you are right natural gas pipelines is performing well.

Speaker Change: As we look forward, we are as I mentioned did in some active discussions with some demand a lot Louisiana some of those out on the industrial corridor as we said before that is a really hot area for US that we are we are on the last day to get some get some Dan demand signed up from industrials out there.

Speaker Change: So we.

Sheridan Swords: So it's our smallest segment, but it's going to have a good. Thanks. Thanks for that.

Speaker Change: Our smallest segment, but it has had its gonna have goodyear.

Speaker Change: Thanks, Thanks for that.

Speaker Change: Okay.

Unknown Executive: And ladies and gentlemen, with that, we'll be ending today's question and answer session.

Speaker Change: And ladies and gentlemen, with that we'll be ending today's question and answer session I'd like to turn the floor back over to Megan Patterson for any closing remarks.

Megan Patterson: I'd like to turn the floor back over to Megan Patterson for any closing. Thank you, Jamie. Our quiet period for the second quarter starts when we close our books in July and extends until we release earnings in early August. We'll provide details for the conference call at a later date. Our IR team is available throughout the day for any follow-ups.

Speaker Change: Thank you Jamie our quiet period for the second quarter starts when we close our books in July and extends until we release earnings in early August we'll provide details for the conference call at a later date, our IR team is available drop day for any follow ups. Thank you all for joining and have a good day.

Unknown Executive: Thank you all for joining and have a good day.

Speaker Change: Okay.

Speaker Change: And ladies and gentlemen, with that we'll conclude today's presentation. We thank you for joining you may now disconnect your lines.

Unknown Executive: And ladies and gentlemen, with that, we'll conclude today's presentation. We thank you for joining. You may now disconnect your line.

Speaker Change: Okay.