Q1 2025 Energy Transfer LP Earnings Call

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Speaker Change: Good day everyone, and welcome to the Energy Transfer Q-1-2025 earning self-in-scal.

Speaker Change: All participants will handle a Smellin' Mode. Did you need assistance today? Please

Speaker Change: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star them one on your telephone keypad. If it's not your question, you may press star them two. Please note today's event is being recorded.

Speaker Change: I would now like to turn the conference over to Tom Long. Let's go ahead.

Tom Long: Thank you, Operator. Good afternoon, everyone, and welcome to the Energy Transfer, for our first quarter, 2025 Burning Skull.

Tom Long: who are here to help answer your questions after our prepared remarks. Hopefully you saw the press release we issued earlier this afternoon. As a reminder, our earnings release contains a thorough MDNA that goes through the segment results in detail, and we encourage everyone to look at the release.

Tom Long: as well as the slides posted to our website to gain a full understanding of the quarter and our growth opportunities.

Tom Long: As a reminder, we will be making forward-looking statements within the meaning of Section 21e of the Security Exchange Act of 1934. These statements are based upon our current beliefs as well as certain assumptions and information currently available to us.

Tom Long: and are discussed in more detail in our Form 10 queue for the quarter-ended March 31st, 2025, which we expect to file this Thursday May 8th. I'll also refer to adjusted EBITDA and Distributal Cash Flow or DCF, both of which are non-GAAP financial measures.

Tom Long: You'll find a reconciliation of our non-get measures on our website.

Tom Long: So let's start with our financial results today for the first quarter of 25. We generated just EBDIF $4.1 billion compared to $3.9 billion for the first quarter of 2024.

as well as through our NGL fractionators.

In addition, we saw strong NGLX ports during the quarter.

Tom Long: DCF, a Tribunal to the Partners of Energy Transfer, as adjusted, was $2.3 billion.

Tom Long: and for the first three months of 2025, we spent approximately $955 million on organic growth capital, primarily in the interstate, midstream, and NGL, refined product segments, excluding Sun and USA Compression Cap-X.

Tom Long: Now, turning to our results, my segment for the first quarter. Let's start with NGL and refine products. Adjustee Badaw was $978 million compared to $989 million for the first quarter of 2024.

Tom Long: This was primarily due to higher throughput across the NGO export terminals and across our Permian and Marineries pipeline operations, which were all set by higher operating expenses and lower blending margins compared to the first quarter of 2024.

Tom Long: From mid-strain, Adjustee Badaw was $925 million compared to $696 million for the first quarter.

Tom Long: of 2024. The increase was primarily due to higher legacy volumes in the Permian Basin, which were up 8% as well as the addition of the WTG-SS in July of 2024.

Tom Long: This represents the remainder of the midstream segment margin from Winter Storm Yuri that had not already been recognized.

Tom Long: Still outstanding in the interest rate segment is approximately $285 million, excluding interest that is currently in litigation. The vast majority of which is due from CPS.

Tom Long: For the crude oil segment, adjusted EBITDA was $742 million, compared to $848 million for the first quarter of 2024. During the quarter, we saw growth across our crude gathering systems, as well as contributions related to the recently formed Permian Joint Venture with Sun.

Tom Long: These were all set by lower transportation revenues, primarily on the Balkan pipeline, higher expenses, as well as lower gains to do to the timing of the recognition of optimization gains in Q1 of 2025 as compared to Q1 of 2024.

Tom Long: Lower optimization gains were primarily due to lower hedge gains realized during the quarter, a right down to hedged inventory at the end of the quarter and the timing of the recognition of gains on certain physical crude sales.

Tom Long: We expect approximately $30 million of losses related to the hedge inventory that were realized in the first quarter of 2025 to reverse during the second quarter of 2025.

Tom Long: In our Interstate Natural Gas Segment, Adjusted EBITDAI was $512 million compared to $483 million for the first quarter of 2024.

Tom Long: During the quarter, we achieved record volumes driven by higher throughput on panhandle, gulf run and trunk line. The growth on trunk line was related to our backhaul project to support growing gulf coast natural gas demand.

Tom Long: We also had increased rates on several of our pipelines in the first quarter.

Tom Long: For the intra state natural gas segment, adjusted EBITDA was $344 million compared to $438 million in the first quarter of last year.

Tom Long: During the quarter, we saw increased gains related to storage optimization opportunities, which were more than offset by reduced pipeline optimization as a result of lower volatility and natural gas prices compared to the first quarter of 2024.

Tom Long: Now, let's take a look at the organic growth capital, God, it's—

Tom Long: We continue to expect approximately $5 billion in organic growth capital projects in 2025. Our projects are expected to achieve mid-teen returns, with most of them also providing incremental downstream benefits.

Tom Long: In addition, the majority of these projects are expected online in 2025 or 2026, including our Flexport NGL export expansion, several Permian processing plan expansions, and our Hugh Branson pipeline project.

Tom Long: Taking a closer look at some of our largest growth projects that are currently underway during the first quarter, we commence construction on phase one of the Hugh Brinson pipeline, which we expect to be in service in the fourth quarter of 2026.

Tom Long: We have secured the majority of the pipeline steel, which is currently being rolled in U.S. pipe mills, and as a result, do not expect any material impacts to cost of the project

Tom Long: of Announcements. Phase 1 is completely sold out and we are currently in negotiations that are well in excess of Phase 2 capacity.

Tom Long: at our Needle and Terminal construction of our Flexport expansion project is nearing completion. We expect to begin ethane service later this month and propane service in July , and we continue to expect to begin ethane export service in the fourth quarter of this year.

Tom Long: Looking at our Permian Processing expansions, the Red Lake Full Processing Plant is now expected to be in service by the end of the second quarter of 2025.

Tom Long: The Badger Processing Plant remains on schedule to be in service in mid 2025, and the Mustang Brawl Plant is now expected to be in service in the second quarter of 2026.

Tom Long: Now let's look at Lake Charles LNG. We are making substantial progress towards commercialization of the project.

Tom Long: In April , Lake Charles LNG and Mid-Ocean Energy signed a heads of agreement which provides a non-binding framework for the joint development of the LNG project.

Tom Long: Pursuit to the HOA, Mid-Ocean, would commit to fund 30% of the construction cost and be entitled to 30% of the LNG production.

Tom Long: Mid-Ocean is an LNG company formed and managed by EIG Global Energy Partners. In April , like Charles LNG signed a binding SBA with a Japanese utility company for up to 1 MTPA.

Tom Long: with the agreement subject to the approval of the Board of this company which is expected to be received by the end of May.

We offer a brief update around our power generation opportunities.

Tom Long: The level of activity from demand pool customers has remained strong and we're in advanced discussions.

Tom Long: with several other facilities in close proximity to our footprint to supply, store, and transport natural gas from gas-fired power plants, data centers, and industrial and onshore manufacturing.

Tom Long: On our last earnings call, we've recited to announce that we have entered into a long-term agreement with cloud burst data centers to provide natural gas to their flagship AI-focused data center development in central Texas.

Tom Long: We would expect these types of projects to require a very low capital and to generate revenue relatively quickly.

Tom Long: There is a lot of competition around these projects, but our team has done an excellent job of identifying the most likely opportunities and we will continue to provide updates as we move forward.

Tom Long: Lastly, construction of 810 MW natural gas fire at electric generation facilities continues.

Tom Long: and now, turning to our guidance, we continue to expect our 2025 adjusted EBITDA to be between $16.1 billion and $16.5 billion.

Tom Long: We benefit from an integrated business model that is well diversified by products and geography.

Tom Long: We also have a high percentage of takeer pay contracts helping to reduce impacts from market volatility.

Tom Long: We are executing on a solid backlog of well-contracted growth projects with strong counterparties which are expected to generate strong returns.

Enhance our Integrated Value Chain and Promote Strong Growth.

Tom Long: We will start to see contributions from some of these projects this year with additional benefits really ramping up next year as we quickly convert CAPEX into cash flow.

Tom Long: You have an Energy Transfer's extensive natural gas infrastructure. We are excited to see the growing demand in and around our branches to support power plant, data center, and LNG growth.

Tom Long: Before we close, we'd like to take a moment to mention Sonoco's recently announced plans to acquire Parkland Corporation. We are excited for Sun as they work to bring these assets into the family of partnerships.

Tom Long: This combination is expected to create the largest independent field distributor in the Americas.

Tom Long: This concludes our prepared remarks. Operator, please open the line up for our first question.

Speaker Change: Thank you, sir. And as a reminder to ask your question, please press star one on your telephone and keep that, and to remove yourself from here, please press star one on your phone.

Good afternoon.

Speaker Change: Increasing competitive dynamics, domestically, as well as increasing demand abroad with the EU Commission proposing to phase out imports of all Russian gas and energy.

Speaker Change: Hello, Theresa. This is Mackay. We continue to gain momentum and be excited about getting that by the way. We've worked many, many years on this.

project. We've got teams over as we speak.

Speaker Change: Fact, even on this call, moment to go, we got it.

Speaker Change: Attacks where we signed up another million tons from a large international energy company, so we're very excited. However, we still got work to do. We're now passing 10.4 million tons. We're targeting about 15 million tons.

Speaker Change: Tom just said on opening statements, we have a big partner in this now we're looking for other partners we're

Speaker Change: At the end of the day, we want about 75 to 8% equity and or infrastructure partners still have that box to check. We are finalizing our EPC cost over these next couple of months.

Speaker Change: and everything's looking good. Like I said, we've got a lot of work to do, but we're very excited about where we're at.

and we're also very excited about the new administration.

Speaker Change: that will not hold up, in fact will promote these types of projects, not only benefit

Our country, our partnership, but also—

Speaker Change: Our friends around the world that need, so desperately need LNG, so we're excited about a lot of work to do and certainly hope we...

Speaker Change: Reach up by the end of the year. As far as the second question you had,

Speaker Change: Successful and continuing to price our capacity in a manner that works for our returns. So, we kind of don't worry and think much about what others are doing. We focus on what we've got and we're excited and are hopeful to get there by the end of the year.

Speaker Change: Thank you. And with one of your portfolio companies getting a C-Corp currency soon potentially, how does that parlay into the potential for energy transfer to also have a C-Corp presence? What are your thoughts on that topic at this point?

Hey, Theresa, this is Tom.

Speaker Change: and see what makes sense from an energy transfer standpoint. Obviously very excited to see it.

Speaker Change: Sun be able to be able to first execute on one and we'll evaluate that carefully but as we sit here right now it's really not any more plans than probably we had before this transaction as far as energy transfer goes so it's an option and we're going to continue to look at it.

and we'll stay tuned, so.

Thank you.

Speaker Change: Thank you, and our next question today comes from Jeremy Tonet with JP Morgan. Please

All right, good afternoon.

Thank you, Jeremy.

Speaker Change: Hi, I was just curious given the volatility we've seen in commodity prices and we're starting to see some rigs being dropped even in the Permian just wondering I guess with your latest producer customer conversations.

Speaker Change: What your outlook is for production if that has changed meaningfully or how do you expect it to impact that energy transfer.

Mackie: Okay. This is mackie again.

Mackie: Typically I will make a brief statement at the end, sometimes I'll make a brief statement real quick and I think it's important for this question and also for other questions that might come up.

Mackie: We were talking a couple of weeks ago and in a lot of us have been in this business for 35 40 years, some like Tom longer than that but.

Mackie: Anyway, we've seen a lot of this is a very cyclical business and we've seen gas at $1 50, we've seen gas at eight or $9. We've seen oil at less than $10. We've seen oil at $120. We've had quarters, where we were panicked about what the spread is between <unk> and Katy because we were a natural gas pipeline company.

Mackie: Unfortunately, where we are today with <unk> leadership and guidance is where the most diversified kind of unparalleled midstream pipeline company in the United States.

Mackie: Just quickly a few comments on that.

Mackie: In addition to kind of our segments, we've got our USA compression run by Klindt Who's doing.

Mackie: Doing a great job of not only maintaining what they have but look for growth over the coming years, we got.

Mackie: Joe Cam and his team with Sonoco, we've done I.

Mackie: Incredible job with the assets. They purchased now they just made a huge announcement that we see a lot of upside for them.

Mackie: Of course that also provides additional distributions, which don't hurt our feelings at all and then you look at our segment do you look at our crude segment run by Adam and his team and we move about 20% of the barrels.

Mackie: Out of West, Texas about 30% of the barrels that are produced in the United States go through our pipes over 50%.

Mackie: The Bakken, we're the largest or the largest deliverers of barrels to their fund to the refineries around port Arthur and then of course Bayou Bridge to the Lake Charles and St. James and then.

Mackie: And so forth up the up the.

Mackie: The mid continent, then you jump over to Ngls and the massive pipelines, we've built with our Mariner and we we are the company to go to with any ethane propane growth hasn't north east through our Marcus Hood book.

Mackie: <unk> and then of course, our incredible expansion at Nederland that we're also completing our next 250000 of our NGL World, where we can move a lot of barrel over a million barrels a day you go into that very excited about that and of course midstream we've got a big presence in the Permian and a lot of other places.

Mackie: And then you look at what's going on in the pipeline bids are intrastate Interstate and how well we built all those out from all the major basins delivering to all the major markets, where there's LNG or whether it's power plants or the utilities are cities or whatever we just have positioned ourself in such a good way to where if one segment slows.

Mackie: Down or whatever they picked it back up so all of that saying go into your question. Yes, we are seeing a slowdown a little bit over the last few weeks, we actually have been in conversations as Tom and I have with with some of the majors. They really havent indicated at these kind of mid to upper <unk>.

Mackie: $50, a barrel pricing that they're necessarily going to slow down, but we have seen even the last day yesterday and today there has been some statements on slowdown.

Mackie: We are well positioned to manage that.

Mackie: This is what happens in this industry it will slow down and it will come back as a barn burner.

Mackie: Certainly anticipate that happening with oil, but even tenfold on gas any kind of slowdown on gas. If you look over the next three or four years.

Mackie: Five to seven Bcf of growth in the LNG market, who knows where the data center and power plants are going to go on a high side or even a medium side on that.

Mackie: It's just a wonderful outlet for our pipeline business, both intra and Interstate so yes, if there's areas where drilling has slowed down with the slowdown in some parts of that.

Mackie: But as a whole we think somebody the other areas of our well balanced partnership will kind of even things out and we just stay very positive and bullish on the future, especially around Ngls and natural gas transportation.

Speaker Change: Got you makes sense, yes, no certainly important to have a diversified platform. There it seems like the slowdown in oil could help the gas supply demand dynamics and can help you out there as well and maybe just building a gas a bit more I guess the opportunity set as you see it to service growing power.

Mackie: Demand in data centers even.

Mackie: Thinking, particularly to the west of Texas just wondering.

Mackie: How you see I guess the opportunity set.

Mackie: To feed more power in Texas or data centers and also further western Arizona as well.

Mackie: Yes, I would tell you. This is one of those areas, where we feel like we're sitting on a goldmine as I. Just mentioned, we built a lot of assets bought a lot of pipeline assets moving molecules from production basins to markets. We wake up here over the last six to 12 months and find ourselves in an incredible position Adam and his team are.

You've got a really good team he's put together to chase deals all over Texas, Theres 150 approximate data centers that we're looking at just in Texas alone, We would love to elaborate and talk about some significant progress we make we do believe in the next four to six weeks, we will be able to make some significant announcements, but what.

Mackie: Really cool about our assets and we've said this before is that if we were going to go out and develop and we are kind of doing this to a certain degree to help for the hyper scaler and try to place. Some of these data centers with place them almost right on top of our pipes.

Mackie: We said last time cloudburst location of our pipeline and actually runs through that that acreage, but we're so well positioned from a electrical transmission standpoint, a lot of the major electric lines running through Texas parallel or very close to our pipelines a lot of the low latency fiber optics runs in the same quarter.

Mackie: Our pipeline. So we're very optimistic would love to elaborate yes, even outside of Texas, We see Arizona as a very significant growth area for data centers really growth area for natural gas demand.

Mackie: In addition to the data centers.

Mackie: We're in other states health or other states, we expect to make some significant announcements over the next four to eight weeks, so little pretty mature, but very excited about where that's going to take us and couldnt be couldn't feel better about our situation, where our pipeline our ability to move large volumes through these large diameter systems and the <unk>.

Mackie: Storage, we have to back up that we just.

Mackie: Couldn't be more excited about these opportunities with Jason.

Mackie: Got it will be listening in the coming weeks to that announcement. Thank you.

Speaker Change: Thank you and our next question today comes from Jean Ann Salisbury with Bank of America.

Speaker Change: Please go ahead.

Speaker Change: Hi, Thank you for the update on the timing of the ethane and propane and service for the Nederland export expansion and it starts in the next few months and can you speak to how youre viewing the speed of the ramp for that project and if you expect that to mainly be shipping propane or ethane in the medium term.

Speaker Change: Yeah.

Mackie: Yeah. This is mackie again.

Mackie: I believe we're coming out of the end of this month early next month with ethane.

Mackie: Regardless of what everybody is hearing about all the negativity around what's going on in China and other areas, we're not having a problem finding a home for our products or ethane LPG back we did a deal. This morning for another ethane spot cargo to China. So.

Mackie: With those tariffs apparently being mifid around ethane and possibly LPG, we feel very good about it.

Mackie: July or August we will be ramping up the propane portion of that and then by the end of this year ethylene.

Mackie: All of that we expect to on a spot basis and or some of it is termed up.

Two big state very full for the second half of this year and then on this new Flex Board.

Mackie: Fashion, where over 90% sold out under three to five year agreement starting January one 'twenty six but we're very excited about that it needs to come online for the international demand around the world and we're excited to finally draw that hundreds of millions of dollars were spent.

Mackie: About the revenue that we're about to bring in the door.

Speaker Change: Okay. That's super helpful. Thank you and then you kind of touched on this but my follow up was just real time, what you are seeing in the LPG export market is they're basically enough rereading rerouting I guess going on to avoid the China tariff on U S. LPG and how do you think that plays out in the next few months.

Mackie: Yes.

Mackie: With all these questions a lot of uncertainty about what's going on in the industry, we have very little concern even talking to our team today.

Mackie: As I, just said Theres a lot of international demand not just China.

Mackie: All of the world for ethane propane and butane and we really don't expect to see any major challenges if any challenges at all selling out our terminal every month.

Mackie: The rest of this year.

Mackie: Great I'll leave it there thank you.

Mackie: Thank you and our next one.

Spiro: And today comes from Spiro <unk> with Citi. Please go ahead.

Speaker Change: Thanks afternoon afternoon team.

Speaker Change: Maybe just to go to your Brinson, Tom you pointed out that negotiations now are well in excess of that phase III capacity. So.

Speaker Change: Multi part question here, one what does that mean for the timing of phase two is there an ability to accelerate that now.

Speaker Change: Does this actually create some bottlenecks, maybe even downstream a few brinson, where that could precipitate more expansions and then lastly, what kind of customers are you dealing with here is it's largely data center driven demand.

Mac Spiro: Yes. This is Mac again spiro.

Mac Spiro: It's funny, we've been trying to get a 42 inch across Texas.

Mac Spiro: For I don't even know for five years and we.

Mac Spiro: We finally got that done and it couldnt have been better timing, especially a lot of your last question was related Datacenters. However, getting that had nothing to do with data centers one data center.

Mac Spiro: Reported that project to get it off the ground as.

Mac Spiro: As we said we have sold out now phase one.

Mac Spiro: We're in negotiations with I wouldn't say twice as much but significantly more volume request and we have capacity available to take it from one five bcf to two two bcf.

Mac Spiro: But as I was just alluding to what an incredible time to announce a new 42 inch to two Bcf pipeline out of the most prolific basin in the United States that connects to multiple 42% and 36 inch pipes of ours that feeds markets throughout the state of Texas and then also of course excesses Carthage and text.

Mac Spiro: To feed the southeast LNG everything else. So we're very excited about that and then as far as data centers.

Mac Spiro: We call it the gold rush, it's something where not only is it.

Mac Spiro: Working with customers that will end up probably utilizing some of the remainder of capacity. We have available. We also have customers that want diversification of receipt points, meaning they may want some from wall ha sung from Kt. Some from cartage, we're able to accommodate that with this massive system was built so we're in such a good situation.

Mac Spiro: We're excited about as I keep saying, we can't express our excitement enough and one kind of exclamation point on this.

Mac Spiro: All of these and it's not just data centers. That's one thing that we probably need to elaborate on we're negotiating with as many power plants on associated with data centers that we think are more likely to happen just because of the need, especially here in Texas to meet the growing demand from population et cetera, So kind of the exclamation point is.

Mac Spiro: So theres not a lot of capital this.

Mac Spiro: As I mentioned earlier a lot of these areas, where these datacenters are proposed or right on top of us. So we're talking about moving 250, 304 hundred 500 different directions with some good healthy margins and yet we're laying them out of the five miles of pipe. So.

Mac Spiro: Is that exciting enough times I'll say, it again, where we're thrilled with this new opportunity for our pipeline assets and are very excited.

Mac Spiro: That's going to take revenues for those assets in the future.

Mac Spiro: Okay great.

Mac Spiro: Great to hear Mackie.

Mac Spiro: Second question, maybe just one for you as well and kind of want to go back to Jeremy's original question ask it a different way and hopefully not make you repeat yourself your point's well taken I think over longer term periods.

Mac Spiro: <unk> proven to be pretty durable and resilient duty cycles.

Mac Spiro: I guess, if we narrow the focus a little bit obviously, a lot of projects coming online this year $5 billion of Capex in the Hopper here.

Mac Spiro: And I think last time, we caught up you did suggest you'd be sort of at the higher end of your sort of 3% to 5% growth rate. This year and maybe next year and so I guess I'm curious given everything we've seen I realize a lot of uncertainty still crude in the fifties, they're still feel like that $5 billion of Capex is got enough hard wired growth inside of it still drive 5% grow.

Mac Spiro: Or maybe just some of that come off a bit.

Mac Spiro: Yes, that's a good question and certainly we're always looking at everything every impact we might have on our system.

Mac Spiro: With some of the statements that have come out even recently.

Mac Spiro: One thing we were joking about before this call is every time, we bring on a plant. We just brought online or one here not too long ago within days certainly within weeks its full and so when we bring on one or two here in the next 30 45 days, we don't know how far it's going to be our expectations are it's going to fill up pretty fast, but we do have the.

Mac Spiro: Luxury is kind of watching what happens over the next quarter, maybe corner have two quarters and if we really do see a slowdown we will have the ability to defer some of these costs, we could delay Mustang draw certainly not talk about think about that or anything right now on that but it's certainly a tool and something that we can look at as well as the other.

Mac Spiro: Projects that we have.

Mac Spiro: If we see a huge downturn is extended for some period of time, we will be able to push some of that $5 billion into 'twenty, six but way premature to.

Mac Spiro: Any kind of that type of I wouldn't say panic, but any of that type of moves where we remain bullish yes, we see some softening, yes, we see some potential challenges over the next quarter or two but gosh a year two years through 10 years, we're extremely bullish.

Mac Spiro: Our industry and the need for all the products that we transport.

Mac Spiro: We'll just see how the next quarter plays out before we make some of those decisions.

Mark: Got it that's great color Mark appreciate it thanks, everyone.

Speaker Change: Thank you. Thank you our next.

Speaker Change: Question for today comes from Keith Stanley at Wolfe Research Wolfe Research. Please go ahead.

Keith Stanley: Hi, good afternoon.

Keith Stanley: Two two follow ups on that so on the Capex conversation.

Keith Stanley: Tom is there is there a figure that you have just roughly if we're talking $5 billion of growth Capex. This year, what would that look like based on just sanctioned projects right. Now for 2026 does that number come down a lot or <unk>.

Speaker Change: How are you looking at that and flexibility for 'twenty six spend.

Keith Stanley: Yes.

Speaker Change: Thank you Keith.

Keith Stanley: Actually a very good question.

Keith Stanley: Sure.

Keith Stanley: Of course, we generally don't give our guidance for the current year until until the end of the end of the year, but when you really look out and you.

Keith Stanley: Probably look at a lot of these projects that we're talking about coming on right now we don't have a.

Keith Stanley: We don't have that same SaaS number currently filled up but we do have as always a big backlog of projects to look at so I don't really have an answer for you on how to guide but.

Keith Stanley: Got it.

Keith Stanley: Probably take it to less than half of that is probably where I would take it with you Keith So, let's let's see how the year continues to develop but as.

Keith Stanley: As we sit here right now that's that's probably a good a good marker without it being guidance, though.

Speaker Change: Okay, so less than half of $5 billion in sanction today, and obviously that can change.

Keith Stanley: Over time.

Keith Stanley: That's com.

Speaker Change: Okay, that's very helpful.

Speaker Change: The second follow up I, just wanted to check on.

Speaker Change: The contracting position just across NGL exports and so I think Maggie you said you expect to fully sell out on a spot basis. All of your available export capacity. We also said flex sports 90% contracted for three to five years is there just looking holistically at your NGL export.

Speaker Change: Is there a percentage of capacity that you would point to as being under fixed fee contracts going forward, including flex Portland.

Maggie: Yeah, Keith so.

Speaker Change: Our spot prices are fixed when we negotiated each month and then our term prices they are fixed.

Speaker Change: So all the whether it's a three year or four year or five year term, it's a fixed fee for us to low ethane propane or butane onto the ships.

Speaker Change: That answer your question.

Speaker Change: I guess I was trying to get at what percentage of the mix of what percentages term contracts versus kind of month to month.

Speaker Change: So.

Speaker Change: The expand the flood sport project that we're bringing on ethane and propane and ethylene throughout the remainder of this year fully contracted fixed price on average three to five years for the flexible capacity that we're putting in service this year.

Speaker Change: Got it thank you.

Speaker Change: Okay.

Speaker Change: And our next question today comes from Michael Blum with Wells Fargo. Please go ahead.

Michael Blum: Thanks, Matt good afternoon, everyone.

Speaker Change: I had a follow up question on <unk>. So.

Speaker Change: It sounds like you have more demand than than your phase two.

Speaker Change: Expansion. So I guess the question is could you expand it further with compression.

Speaker Change: Do you have another option would you somehow need to add another pipeline or.

Speaker Change: And the other question related to that is.

Speaker Change: Does this give you more pricing power and the ability to charge higher rates or could you see a higher return on a project like that.

Speaker Change: Well, let me just say our prices are always fair and.

Speaker Change: Competitive.

Speaker Change: We may have some markets on the phone but.

Speaker Change: No anything like that of course, we can always look pipe.

Speaker Change: We can always add compression.

Speaker Change: We actually now are looking at making <unk> fully bidirectional.

Speaker Change: That's at a relatively inexpensive price.

Speaker Change: This to make that work.

Speaker Change: But I guess to kind of round out the answer we feel really good about the value of the capacity that we have yet to sell on <unk>.

Speaker Change: And the amount of revenues, that's going to create for our partnership both from a west to east.

Speaker Change: Route as well as from an east to West route across Texas, So as I mentioned, we're very well positioned and.

We think we're going to do very well on adding significant value with all of these not only data centers, but with all of the power plant opportunities that we have not only in Texas, but in a number of other states.

Speaker Change: Got it thanks, that's all I had today.

Speaker Change: Thank you and our next call.

Speaker Change: Comes from Manav Gupta with UBS. Please go ahead.

Good afternoon I wanted to ask you it's been about six months since you had the new president and a new government have things actually changed on the ground are you seeing more support the permitting process and in general are you seeing more support for oil and gas industry from the New administration.

Speaker Change: Yeah absolutely.

We didn't expect it to be this big of an impact on things yet, but long term. We think the decisions that this administration will be very good for our country and very good for our industry and very good for our our partnership in regards to permitting.

Speaker Change: Those without saying that the pause around LNG whatever pause there was left has been lifted.

Speaker Change: The energy dominance Council under the Department of interior is.

Speaker Change: Doing everything they can to <unk>.

Speaker Change: Arne about projects and to help projects get to the finish line, where they make sense.

Speaker Change: As far as any extensions for example around our LNG project.

Speaker Change: <unk> extensions or extensions.

Speaker Change: Feel very good about getting those so a general overall statement is things are much more positive we think it will become much easier to build infrastructure with a lot more certainty for ourselves and for our customers and for the country. So as we talked about for the last four years, where we are.

Speaker Change: We're excited about this new administration, and where it's going to take this country.

Speaker Change: Our partnership will benefit from it.

Speaker Change: I'll take my quick and easy follow up here on is your guidance still remains for 2025, 16.1% to $16 five and those of US leading Nike hope at $16 five help us understand despite some of the small slowdowns that seeing what could still get you closer to $16 five versus the midpoint of the guidance. Thank you.

Speaker Change: Sure.

Speaker Change: Yes. This is Don here. So when we think about that guidance range. One thing I do want to point out before I start here, we put out this range of growth range of $400 million that's on.

Speaker Change: At the midpoint of $16 3 billion. So if you think about that from the midpoint to the high and the low enrollment going up less than 1.25% each way. So that's a pretty tight range.

Speaker Change: There's a lot of drivers in there we feel really good about.

Speaker Change: About this plan when we put it out.

Speaker Change: And we still feel really good about it right now.

Speaker Change: It's the usual things commodity commodity price movements spreads.

Speaker Change: Those make up about 10% of our of our business there than.

Speaker Change: And then there is.

Speaker Change: Theres, a little bit of volume exposure as well within you know primarily the midstream segment.

Speaker Change: That's fairly muted as well, but those.

Speaker Change: Really the drivers that can move us within that.

Speaker Change: 5% range top to bottom Ed.

Speaker Change: Thank you so much.

Speaker Change: Thank you and our next question today comes from John Mcnulty with Goldman Sachs. Please go ahead.

John Mcnulty: Hey, guys. Thanks for the time I wanted to talk about <unk> for a second it's been about I guess three quarters.

Speaker Change: Since you guys closed on that.

Anything you can kind of update us on in terms of how that asset is doing right now your ability to kind of ramp it up and start to retake share in the Midland and then anything that's coming out of it on the NGL side, that's giving you.

Speaker Change: Some confidence on the on the contracting piece on on the D&S side. Thanks.

Speaker Change: This is Matt I'll start and Dave may want to follow up but.

Speaker Change: What a great acquisition.

Speaker Change: Tremendous amount of reserve and contracts dedicated to those assets.

Speaker Change: Have discovered as we've kind of started operating them. The some issues that have come up that we continue to address but long term. We're excited about the growth both from a cryogenic from a gathering standpoint, but also from a downstream we mentioned <unk> will be at the tailgate of the majority of the <unk> cryo there'll be.

Speaker Change: Great outlet.

Speaker Change: There is issues, we are having issues from time to time with the existing pipeline so that'll help.

Speaker Change: Big way, but.

Speaker Change: As well as the Ngls.

Speaker Change: Ngls are already dedicated we do see growth in Ngls coming from these facilities in the future for our NGL pipeline and fracking business, but all in all we are.

Speaker Change: Very pleased about that asset and working hard to bring it up to the full standards of energy transfers other assets, it's going to be a great contributor to our partnership for many years ago.

Yes, Matthew sorry that would be fair that Greg I think when we look back versus our acquisition plan and as many of you recall, we have a lot of maintenance capex for maintenance capital and for the first two years as we recognize there was going to be some work to do and we are definitely spending that capital.

Speaker Change: But on the plus side. The volumes are the volumes are ahead of the plan that we had an acquisition and so.

Speaker Change: I think we're really pleased the producers behind the system are great partners and we're seeing the financial benefits of that on the revenue side. So all in all financially this is Scott.

Speaker Change: Turned out to be a great acquisition for us.

Speaker Change: I appreciate that thank you and second one will be quick.

Speaker Change: Just going back to <unk> question on the guidance not to belabor the point, but since the range. Just so I just wanted to ask the $160 million benefit in midstream this quarter was that.

Speaker Change: Kind of expected inside the guide and then how are you guys treating the remainder.

Speaker Change: Storm proceeds that you haven't recognized yet relative to that guidance range.

Speaker Change: Yes, I would say.

Speaker Change: That wasn't explicitly as part of the guide now when we look at the guide the one thing that somewhat offsets that is the first quarter and our guide.

Speaker Change: We've assumed internally some volatility in there that we capture on the intrastate segment I'll say this first quarter, we did not have the volatility that we've seen in past years and so so we were short on that Mark. There. So this is a little bit of an offset there versus some stretch that we've put into the business in the first quarter.

Speaker Change: So you kind of consider that a wash as we go forward here.

Speaker Change: I appreciate that thanks for your time.

Speaker Change: Thank you and our next question comes from Gabe Moreen with Mizuho. Please go ahead.

Gabe Moreen: Hey, good afternoon, I just had one follow up on Lake Charles given I guess all of the activity just trying to get gas to the Gulf coast for LNG exports.

Gabe Moreen: And also the mid Ocean agreement, saying that they'll use energy transfer pipes to get gas to their portion of the facility can you calibrate.

Gabe Moreen: Kind of the upstream opportunities on the pipe side now that youre getting close to be whether it's getting gas from the haynesville across the border from Texas, just kind of your latest thoughts on how big that opportunity could be.

Gabe Moreen: You bet, it's a mismatch again, it's a huge opportunity yes, we do intend for all of the molecules that come in in Lake Charles will some where somehow moved through our pipelines, we have the ability to move quite a bit of gas to that area. Today, we will be needing to expand where exactly that expansion come to and what size and timing.

Gabe Moreen: All of that we're still working through that.

Gabe Moreen: Pending on what the customers' desires are but probably unlike any other LNG.

Gabe Moreen: We will have the ability to source from from the Permian Basin from Carthage from Oklahoma from parity will from North, Louisiana from East, Texas from Katy So.

Gabe Moreen: With our extensive pipeline intra Interstate network.

Gabe Moreen: Having the ability to provide our customers and ourselves with access to the cheapest sources of supply wherever those may be from all of those points. We just talked about so we're still fine tuning and finalizing what additional upstream pipelines will be necessary and those will be also.

Gabe Moreen: By the end of this year as well.

Gabe Moreen: In conjunction with the Lake Charles.

Matthew: Thanks Matthew.

Gabe Moreen: Thank you.

Tom Long: A question and answer session I would like to turn the conference back over to Tom long for closing remarks.

Tom Long: Thank you and thank you Charlie for joining us we're always very very appreciative of your support and we look forward to any follow up questions you might have.

Tom Long: Thank you. This concludes today's conference call. Thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.

Tom Long: [music].