Q1 2025 Western Midstream Partners LP Earnings Call
Ludi: My name is Ludi, and I will be your conference operator today.
Good morning, My name is Judy and I will be a conference operator today at this time I would like to welcome everyone to the Western Midstream partners first quarter 'twenty 25 earnings conference call. All lines have been placed on mute to prevent any background noise out there just because your March journal.
Ludi: At this time, I would like to welcome everyone to the Western Meadstream Partners First Quarter 2025 Earnings Conference Call. All lines have been placed on mute to prevent any background noise.
Ludi: After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press star followed by the number two. Thank you.
Speaker Change: A question and answer session. If you would like to ask a question. During this time simply press the star followed by the number one I guess telephone keypad. If he would like you would go to a question. Please press star followed by then a break you. Thank you I would now like to turn the conference over to Daniel Jenkins Director of Investor Relations. Please go ahead.
Daniel Jenkins: I would now like to turn the conference over to Daniel Jenkins, Director of Investor Relations. Please go ahead. Thank you.
Daniel Jenkins: I'm glad you could join us today for Western Midstream's first quarter 2025 conference. I would like to remind you that today's call, the accompanying slide deck, and last night's earnings release contain important disclosures regarding forward-looking statements and non-GAAP reconciliation. Please reference Western Midstream's most recent Form 10-K and 10-Q and other public filings for a description of risk factors that could cause actual results to differ materially from any forward-looking statements we discussed today. Relevant reference materials are posted on our website.
Daniel Jenkins: Thank you I'm glad you could join us today for Western Midstream first quarter 2025 conference call.
Daniel Jenkins: I would like to remind you that today's call the accompanying slide deck and last night's earnings release contain important disclosures regarding forward looking statements and non-GAAP reconciliations.
Daniel Jenkins: Please reference western midstream <unk>, most recent Form 10-K, and 10-Q and other public filings for a description of risk factors that could cause actual results to differ materially from any forward looking statements we discussed today.
Speaker Change: Relevant reference materials are posted on our website with me today are Oscar Brown, our Chief Executive Officer, Danny Holderman, Our Chief operating officer, and Kristine Schulze, Our Chief Financial Officer, I'll now turn the call over to Oscar.
Daniel Jenkins: With me today are Oscar Brown, our Chief Executive Officer, Danny Holderman, our Chief Operating Officer, and Kristen Shults, our Chief Financial Officer.
Oscar Brown: I'll now turn the call over to Oscar.
Oscar Brown: Thank you, Daniel, and good morning, everyone. Yesterday, we reported another successful quarter for WES, marked by strong financial performance and continued high levels of customer service and system-wide operability. I'm also pleased to announce that we completed the commissioning of the North Loving Plant in the Delaware Basin in mid-February, and it became operational later that month. This is our first major greenfield construction project as a stand-alone partnership. And I would like to thank the teams involved for bringing the plant to completion. This achievement increases our West Texas natural gas processing capacity by approximately 13 percent, or 250 million cubic feet per day, benefiting West financially through our fixed-fee processing agreements and reducing our need for offload.
Oscar Brown: Thank you Daniel and good morning, everyone yesterday, we.
Oscar Brown: We reported another successful quarter for west marked by strong financial performance and continued high levels of customer service and system wide Operability.
Oscar Brown: I'm also pleased to announce that we completed the commissioning of the north loving plant in the Delaware Basin in mid February and it became operational later that month.
Oscar Brown: This is our first major Greenfield construction project as a standalone partnership.
Oscar Brown: Like to thank the teams involved for bringing the plant to completion.
Oscar Brown: This achievement increases our west, Texas natural gas processing capacity by approximately 13% or 250 million cubic feet per day.
Oscar Brown: Benefiting west financially through our fixed fee processing agreements and reducing our need for off loads.
Oscar Brown: Thanks again to our employees and contractors for bringing the North Loving plant online safely, ahead of schedule, and under budget.
Oscar Brown: Thanks, again to our employees and contractors for bringing the north loving plant online safely ahead of schedule and under budget before turning the call over to Dan and Kristen I want to address the recent market volatility and reiterate what's a strong position since early 'twenty 'twenty, we've taken significant steps to strengthen our balance sheet optimized.
Oscar Brown: Before turning the call over to Danny and Kristen, I want to address the recent market volatility and reiterate West's strong position. Since early 2020, we have taken significant steps to strengthen our balance sheet, optimize our asset portfolio, reduce operational costs, and generate substantial free cash flow. These actions have meaningfully reduced our leverage, enabled disciplined investment in organic growth projects supported by minimum volume commitments, and allowed us to return significant capital to unit holders. Today, we have the strongest balance sheet in the partnership's history, an investment-grade credit rating, net leverage below three times, and approximately $2.4 billion of liquidity, giving us financial optionality and flexibility to navigate and potentially take advantage of volatile markets and commodity price cycles.
Oscar Brown: Our asset portfolio reduce operational costs and generate substantial free cash flow. These actions have meaningfully reduced our leverage enabled disciplined investment in organic growth projects supported by minimum volume commitments and allowed us to return significant capital to unitholders today, we have the strongest balance sheet in the partnership's history and <unk>.
Oscar Brown: That's my grade credit rating net leverage below three times and approximately $2 $4 billion of liquidity, giving us financial optionality and flexibility to navigate and potentially take advantage of volatile markets and commodity price cycles.
Oscar Brown: Our stable, long-term contract structures, proactive customer engagement, and strategic supply chain sourcing all contribute to our financial resilience. Our contracts, which include cost of service protections and or minimum volume commitments, provide more predictable cash flows, even when commodity prices are volatile. By maintaining close communication with our customers regarding their drilling and completion plans, we can quickly reduce capital spending if desired. Additionally, our potential direct tariff exposure for 2025 is minimal because we've already ordered all the pipe needed to construct the Pathfinder produced water pipeline from a domestic steel mill using mostly U.S. produced materials. Also regarding Pathfinder, I am pleased to share that we have had positive conversations with several customers and midstream providers regarding contracting pipe space prior to the estimated January 2027 in-service.
Oscar Brown: Our stable long term contracts structures proactive customer engagement and strategic supply chain sourcing all contribute to our financial resilience our contracts, which include cost of service protections and or minimum volume commitments provide more predictable cash flows even when commodity prices are volatile.
Oscar Brown: By maintaining close communication with our customers regarding their drilling and completion plans, we can quickly reduce capital spending if desired.
Oscar Brown: Additionally, our potential direct tariff exposure for 2025 is minimal because we've already ordered all the pipe needed to construct the pathfinder produced water pipeline from a domestic steel mill using most of U S. Produced materials also regarding Pathfinder I am pleased to share that we have had positive conversations with several customers and midstream providers regarding <unk>.
Oscar Brown: Contracting type space prior to the estimated January 20th twenty-seven in service date with that I'll turn the call over to our Chief operating officer, Danny Holderman to discuss our operational performance in the first quarter Danny Thank you Oscar and good morning, everyone. Our first quarter natural gas throughput decreased by 2% on a sequential quarter base.
Danny Holderman: With that, I'll turn the call over to our Chief Operating Officer, Danny Holderman, to discuss our operational performance in the first quarter. Danny?
Danny Holderman: Thank you, Oscar, and good morning, everyone. Our first quarter natural gas throughput decreased by 2% on a sequential quarter basis, primarily due to lower volumes from the DJ basin, which achieved a record in the prior quarter, and from the Powder River. These declines were partially offset by volume growth from our other assets, specifically in South Texas. Volumes from the Delaware Basin were slightly higher sequentially, but a bit below expectations as a result of delays in wells coming online relative to our initial estimate. Our crude oil and NGL's throughput decreased by 6% on a sequential quarter basis due to reduced throughput from our equity investments and lower volumes from both the D.J.
Oscar Brown: This is primarily due to lower volumes from the DJ basin, which achieved a record in the prior quarter and from the Powder River Basin. These declines were partially offset by volume growth from our other assets, specifically in South, Texas, and Utah volumes from the Delaware Basin were slightly higher sequentially, but a bit below expectations as a result of delays in <unk>.
Oscar Brown: Else coming online relative to our initial estimates coming into the year, our crude oil and NGL throughput decreased by 6% on a sequential quarter basis due to reduced throughput from our equity investments and lower volumes from both the DJ and Delaware basins are operated crude oil and Ngls throughput decreased by 3% on a sequential quarter basis.
Danny Holderman: and Delaware basins. Our operated crude oil and NGL's throughput decreased by 3% on a sequential quarter basis. Additionally, our produced water throughput decreased by 2% on a sequential quarter basis due to the timing of wells coming online in the Delaware Basin and slightly higher recycling activity. Our first quarter per 1,000 cubic foot adjusted gross margin for our natural gas assets increased by 5 cents compared to the prior quarter. This increase was primarily driven by increased excess natural gas liquids volumes under our fixed recovery contracts at our West Texas complex in combination with higher overall natural gas liquids pricing.
Oscar Brown: Additionally, our produced water throughput decreased by 2% on a sequential quarter basis due to the timing of wells coming online in the Delaware basin and slightly higher recycling activity in the quarter, our first quarter per thousand cubic foot adjusted gross margin for our natural gas assets increased by five cents compared to the prior quarter. This increase was primarily due.
Oscar Brown: <unk> by increased excess natural gas liquids volumes under our fixed recovery contracts at our West Texas complex in combination with higher overall natural gas liquids pricing going forward, we expect our second quarter per thousand cubic foot adjusted gross margin to be more in line with the fourth quarter, primarily due to lower forecasted excess natural gas liquids.
Danny Holderman: Going forward, we expect our second quarter per 1,000 cubic foot adjusted gross margin to be more in line with the fourth quarter, primarily due to lower forecasted excess natural gas liquids volumes and reduced NGL pricing experience so far in the system. Our first quarter per barrel adjusted gross margin for our crude oil and NGL assets increased by $0.17 compared to the prior quarter due to the timing of distribution payments associated with our equity investments. On an operated basis, our per barrel adjusted gross margin remained relatively flat. We expect our second quarter per barrel adjusted gross margin to be more in line with the fourth quarter due to more normalized distributions from our equity investments.
Oscar Brown: <unk> and reduced NGL pricing experienced so far in the second quarter, our first quarter per barrel adjusted gross margin for our crude oil and NGL assets increased by 17 cents compared to the prior quarter due to the timing of distribution payments associated with our equity investments.
Oscar Brown: On an operated basis our per barrel adjusted gross margin remained relatively flat, we expect our second quarter per barrel adjusted gross margin to be more in line with the fourth quarter due to a more normalized distributions from our equity investments our first quarter per barrel adjusted gross margin for our produced water assets decreased by two cents and was in line with our expectations.
Danny Holderman: Our first quarter per barrel adjusted gross margin for our produced water assets decreased by 2 cents and was in line with our expectations due to the new produced water amendment we executed with Oxy and the cost of service rate redetermination, both of which became effective on January 1st. Going forward, we expect our second quarter per barrel adjusted gross margin to be in line with the first quarter. Turning our attention to the remainder of the year, at this time, we still expect our portfolio-wide average year-over-year throughput to increase by mid-single-digits percentage growth for both natural gas and produced water, and low-single-digits percentage growth for crude oil and NGLs.
Oscar Brown: Due to the new produced water Amendment, we executed with oxy and the cost of service rate Redetermination, both of which became effective on January one.
Oscar Brown: Going forward, we expect our second quarter per barrel adjusted gross margin to be in line with the first quarter.
Oscar Brown: Turning our attention to the remainder of the year at this time, we still expect our portfolio wide average year over year throughput to increase by mid single digits percentage growth for both natural gas and produced water at low single digits percentage growth for crude oil and Ngls for year over year comparative purposes. These expectations exclude the volumes associated with it.
Danny Holderman: For year-over-year comparative purposes, these expectations exclude the volumes associated with the non-core asset sales that closed in early 2021. In the Delaware Basin, we still expect average year-over-year throughput to increase modestly for all three product lines and for the basin to continue being the main engine of throughput growth in 2025. As Oscar previously mentioned, we are staying in close contact with our customers due to the volatile market and recent commodity price weakness. Our Delaware Basin customers remain focused on capital discipline and operational efficiency as they continue to monitor the pricing environment before making any long-term operational changes.
Oscar Brown: Non core asset sales that closed in early 2024 in the Delaware Basin, we still expect average year over year throughput to increase modestly for all three product lines and for the basin to continue being the main engine of throughput growth in 2025 as Oscar previously mentioned, we are staying in close contact with our customers due to the volatile market.
Oscar Brown: In recent commodity price weakness, our Delaware basin customers remain focused on capital discipline and operational efficiency as they continue to monitor the pricing environment before making any long term operational changes we plan to stay engaged with all of our customers and are prepared to adjust our plans as needed.
Danny Holderman: We plan to stay engaged with all of our customers and are prepared to adjust our plans. In the DJ Basin, we still expect average year-over-year throughput to remain flat for natural gas and to be flat to slightly down for crude oil and engine oil. In the Powder River Basin, even though our most active customers continue to evaluate the current environment, we still expect average year-over-year throughput for both natural gas and crude oil and NGLs to increase slightly. We also still expect meaningful natural gas throughput growth from our other assets, specifically in the Uinta Basin, to commence early in the second half of 2025, driven by increased volumes from Williams Mountain West Pipeline expansion and a tie-in of Kinder Morgan's Altamont Pipeline to our Chapita plant early in the third quarter.
Oscar Brown: In the DJ Basin, we still expect average year over year throughput to remain flat for natural gas and to be flat to slightly down for crude oil and Ngls in.
Oscar Brown: In the powder River basin, even though our most active customers continue to evaluate the current environment, we still expect average year over year throughput for both natural gas and crude oil and Ngls to increase slightly.
Oscar Brown: We also still expect a meaningful natural gas throughput growth from our other assets specifically in the Uinta basin to commence early in the second half of 2025, driven by increased volumes from Williams Mountain West pipeline expansion and the tie in of Kinder Morgan's Alt about pipeline to our chip heater plant early in the third quarter.
Danny Holderman: Finally, if any of our customers begin to alter their development plans, we can pivot and delay certain expansion capital projects.
Oscar Brown: Finally, if any of our customers began to alter their development plans, we can pivot and delay certain expansion capital projects.
Danny Holderman: Any material changes to our capital expenditure plan would impact growth and development plans late in the second half of this year, which would most likely impact our initial throughput expectations for 2026, as opposed to material impacting throughput in 2026.
Oscar Brown: Material changes to our capital expenditure plan would impact growth and development plans late in the second half of this year, which would most likely impact our initial throughput expectations for 2026 as opposed to a material impacting throughput in 2025.
Kristen Shults: With that, I'll turn the call over to Kristen to discuss our financial performance during the... Thank you, Dani, and good morning, everyone. During the first quarter, we generated net income attributable to limited partners of $302 million and adjusted EBITDA of $594 million. Relative to the fourth quarter, our adjusted growth margin decreased by $8 million, which was primarily driven by decreased throughput and the recording of $9.2 million of favorable revenue recognition cumulative adjustments that we benefited from in the fourth quarter and that did not reoccur in the first quarter, associated with redetermined cost of service rates on certain contracts associated with our assets in South Texas and our DJ Basin oil .
Oscar Brown: With that I'll turn the call over to Christian to discuss our financial performance during the quarter.
Christian: Thank you Danny and good morning, everyone. During the first quarter, we generated net income attributable to eliminate partners at $302 million and adjusted EBITDA of $594 million realm.
Christian: Relative to the fourth quarter, our adjusted gross margin decreased by $8 million, which was primarily driven by decreased throughput and the recording of $9 $2 million of favorable revenue recognition cumulative adjustments that we benefited from in the fourth quarter and that did not reoccur in the first quarter associated with re determining cost of service rates on certain contracts.
Christian: <unk> associated with our assets in South, Texas, and our DJ Basin oil system. These decreases were partially offset by increased gross margin contribution from our Delaware basin natural gas assets.
Kristen Shults: These decreases were partially offset by increased growth margin contribution from our Delaware Basin natural gas assets due to higher excess natural gas liquid volumes in combination with higher NGL pricing. Our operation and maintenance expense decreased slightly quarter over quarter, but we expected to trend modestly higher in both the second and third quarters, primarily due to increased asset maintenance and repair expense and higher expected utility costs, all of which should be partially offset by ongoing cost containment efforts. We continue to expect seasonality associated with our utility expense in the summer months, mostly due to higher estimated electricity prices.
Christian: Higher excess natural gas liquids volumes in combination with higher NGL pricing, our operation and maintenance expense decreased slightly quarter over quarter, but we expect it to trend modestly higher in the second and third quarters.
Christian: Really due to increased asset maintenance and repair expense and higher expected utility costs.
Christian: All of which should be partially offset by ongoing cost containment efforts.
Christian: We continue to expect seasonality associated with our utility expense in the summer months, mostly due to higher estimated electricity pricing.
Kristen Shults: As a reminder, we are able to seek reimbursement for approximately 75% of our utility costs portfolio-wide from our producing customers. Turning to cash flow, our first quarter cash flow from operating activities totals $531 million, generating free cash flow of $399 million. Free cash flow after our fourth quarter 2024 distribution payment in February was $58 million. Focusing on capital markets activities, we retired $664 million of senior notes upon their maturity in early January with cash on hand, and we maintained our trailing 12-month net leverage ratio of just below three times at quarter end. Looking forward, we plan to retire the remaining tranche of senior nodes that mature in 2025 in early June with cash on hand and from free cash flow generation.
Christian: As a reminder, we are able.
Christian: To seek reimbursement for approximately 75% of our utility cost portfolio wide from our producing customers turning to cash flow, our first quarter cash flow from operating activities totaled $531 million generating free cash flow of $399 million.
Christian: Free cash flow after our fourth quarter 2024 distribution payment in February was $58 million.
Christian: Focusing on capital markets activities, we retired $664 million of senior notes upon their maturity in early January with cash on hand, and we maintained our trailing 12 months net leverage ratio of Jetblue three times at quarter end.
Christian: Looking forward, we plan to retire the remaining tranche of senior notes that mature in 2025 in early June with cash on hand, and from free cash flow generation.
Kristen Shults: In April, we declared a quarterly distribution of $0.91 per unit, which represents a 4% increase over the prior quarter's distribution that will be paid on May 15 to unit holders of record on May 2. At this time, we're not making any changes to our 2025 financial guidance ranges. With that said, the lower commodity price environment could have an impact on our profitability in line with the sensitivities that we have provided in our investor deck. Even if that turns out to be the case, we would still expect our full year 2025 results to be within the guidance ranges that we have provided.
Christian: In April we declared a quarterly distribution of <unk> 91 per unit, which represents a 4% increase over the prior quarter's distribution that will be paid on may 15th to unitholders of record on may 2nd at this time, we're not making any changes to our 2025 financial guidance ranges with that said the lower commodity price environment could have it.
Christian: The impact on our profitability in line with the sensitivities, we have provided at our Investor day, even if that turns out to be the case, we would still expect our full year 2025 results to be within the guidance ranges that we have provided with that I will now turn the call over to Oscar for closing remarks. Thanks, Kristen before we open it up to Q&A I would like to highlight why.
Oscar Brown: With that, I will now turn the call over to Oscar for closing remarks. Thanks, Kristen. Before we open it up to Q&A, I would like to highlight why WES is well-positioned to manage the recent market volatility. First, we continue to be prudent allocators of capital, which should support our future growth and profitability. All major expansion projects, such as Mentone 3, North Loving, and Pathfinder, are backed by material minimum volume commitments, which provide adjusted EBITDA and free cash flow stability, even during commodity price swings, that help us achieve our targeted return. Second, our disciplined capital allocation decisions have delivered leading returns for our investors.
Oscar Brown: West is well positioned to manage the recent market volatility first we continue to be prudent allocators of capital, which should support our future growth and profitability.
Oscar Brown: All major expansion projects, such as Menton, three north loving and Pathfinder are backed by material minimum volume commitments, which provide adjusted EBITDA and free cash flow stability, even during commodity price swings that help us achieve our targeted returns.
Oscar Brown: Second our disciplined capital allocation decisions have delivered leading returns for our investors.
Oscar Brown: Since becoming a standalone partnership, West has generated leading return on capital employed and has maintained one of the highest positive rates of change in ROCE among midstream peers. Our strong distribution yield has also resulted in a leading total capital return yield compared to both midstream peers and all sectors of the S&P 500 for at least 11 consecutive quarters. And finally, Wes's strong balance sheet gives us the flexibility to execute multi-year expansion projects, like Pathfinder, driving future profitability and supporting our return. We plan to maintain a strong balance sheet with net leverage at or below 3X, allowing us to pursue growth while increasing distributions, such as the 4% increase to the distribution that will be paid later this month.
Oscar Brown: Since becoming a standalone partnership West has generated leading return on capital employed and has maintained one of the highest positive rates of change in our oce among midstream peers. Our strong distribution yield has also resulted in a leading total capital return yield compared to both the midstream peers in all sectors of the S&P 500.
Oscar Brown: Or at least 11 consecutive quarters.
Oscar Brown: And finally with a strong balance sheet gives us the flexibility to execute multiyear expansion projects like pathfinder driving future profitability and supporting our returns we.
Speaker Change: We plan to maintain a strong balance sheet with net leverage at or below three times, allowing us to pursue growth, while increasing distributions such as the 4% increase to the distribution that will be paid later this month before turning the call over to Q&A I'm delighted to highlight that Bob Phillips, the founder and CEO of Crestwood equity partners until its merger with energy.
Oscar Brown: Before turning the call over to Q&A, I'm delighted to highlight that Bob Phillips, the founder and CEO of Crestwood Equity Partners until its merger with Energy Transfer, has recently joined our board as an independent director. Bob brings significant midstream knowledge and expertise to our already talented board, and his years of successful leadership within the midstream space will be invaluable as we execute on our capital-efficient growth strategy with the goal of creating long-term value for all of our stakeholders.
Speaker Change: Transfer has recently joined our board as an independent director, Bob brings significant midstream knowledge and expertise to our already talented board as years of successful leadership within the midstream space will be invaluable as we execute on our capital efficient growth strategy with the goal of creating long term value for all of our stakeholders.
Oscar Brown: Thank you to the entire West workforce for your hard work and dedication. We have had a strong start to 2025, and I am proud of how everyone has maintained focus on servicing our customers and progressing our cost containment effort. especially in light of the recent market uncertainty. We remain committed to achieving our 2025 goals, and I look forward to sharing our progress on our second quarter earnings call in August.
Speaker Change: Thank you to the entire west workforce for your hard work and dedication we have had a strong start to 2025 and I am proud of how everyone has maintained focus on servicing our customers and progressing our cost containment efforts, especially in light of the recent market uncertainty.
Speaker Change: We remain committed to achieving our 2025 goals and I look forward to sharing our progress on our second quarter earnings call in August with that we'll open the call for questions.
Oscar Brown: With that, we'll open the call for Thank you.
Ludi: And at this time, I would like to remind everyone in order to ask a question, please press star followed by the number one on your cell phone keypad. We'll pause for just a moment to compile the Q&A roster.
Speaker Change: Thank you and at this time I would like to remind everyone in order to ask a question. Please press star followed by the number one on your telephone keypad cluster gets you a moment to compile the Q&A roster.
Spiro Dounis: And your first question comes from the line of Spiro Dounis with Citi. Please go ahead. Thanks, operator.
Speaker Change: And your first question comes from the line of Ciara Dennis with Citi. Please go ahead.
Spiro Dounis: Good morning, team.
Ciara Dennis: Thanks, operator, good morning team.
Oscar Brown: Oscar, I want to go back to some of your closing comments there, talked about strong balance sheet and flexibility, and sort of mentioned capital allocation. So, you know, I'm just curious, to the extent we do sort of move into a slower growth environment here, curious how that allocation stack, maybe restacks, how you reprioritize some of those, some of those bucket Thanks for that. No, I don't think we'd change our strategy in any way or our priorities. Obviously, as the environment slows and there's less organic growth opportunities, I think we're in great shape to take advantage of potential acquisitions and things like that.
Ciara Dennis: I just want to go back to some of your closing comments, there talk about strong balance sheet and flexibility and sort of mentioned capital allocation. So I'm just curious to the extent, we do sort of move into a slower growth environment here curious how that allocation stack maybe re stacks are you re prioritize some of those some of them.
Ciara Dennis: As buckets.
Ciara Dennis: Yeah. Thanks for that no I don't think we've changed our strategy in any way or our priorities obviously as the environment slows then there's less organic growth opportunities I think we're in great shape to take advantage of potential acquisitions and things like that obviously will continue to be opportunistic when we look.
Oscar Brown: You know, obviously, we'll continue to be opportunistic when we look at the opportunities for a stock buyback or reducing debt further. But really, so far, what we're seeing is pretty robust activity in terms of assets available in the M&A market. So that's something that we're keeping an eye on. And if the market continues to be volatile, we'd hope that sellers' expectations around price would change accordingly. But so far, we're keeping our BD team pretty busy. Got it. That's helpful.
Ciara Dennis: The opportunities for stock buyback or reducing debt further really so far what we're saying is pretty robust activity in terms of assets available in the M&A market. So that's something that we're keeping an eye on in the third.
Ciara Dennis: It continues to be volatile, we'd hope that sellers expectations around price will change accordingly.
Ciara Dennis: But so far were keeping our BD team pretty busy.
Ciara Dennis: Yeah.
Ciara Dennis: Got it that's helpful second.
Oscar Brown: Second question, just maybe going to guidance for the rest of the year. I think as it stands, looks like guidance would imply a stronger second half of the year. And so just want to get you to maybe fine tune that a little bit. I'm not sure if there's any specific projects ramping up from here. Obviously, North Loving is online now, just to really point to and maybe which basins are really driving that in the go forward. I think it's, I mean, as we mentioned, nothing's really changed materially in the outlook. And so you're correct, we've expected the volumes to pick up a bit.
Ciara Dennis: Second question, just moving on to guidance for the rest of the year I think as it stands.
Ciara Dennis: It looks like guidance would imply a stronger second half of the year and so just wondering if you can maybe fine tune that a little bit.
Ciara Dennis: I'm not sure if there's any specific projects ramping up from here, obviously north loving is online now just just to really point to and maybe which basins are really driving that and to go forward.
Ciara Dennis: I think it's I mean, as we mentioned nothing's really changed materially on the outlook and so you are correct. We've expected the volumes to pick up a bit we came off a very strong fourth quarter and so that's sort of impacted.
Oscar Brown: We came off in a very strong fourth quarter, and so that sort of impacted just sort of the tough comparables, you know, sequentially. But for the remainder of the year, there's no signs yet that our outlook should change on volume expectations. You know, growth continued to be driven by West Texas, as Danny said, also in the Uinta. Some growth is still in the powder, although we're making investments there in anticipation of 2026. That's obviously an area where if activity changes for some reason, then we can adjust capital accordingly pretty easily. So yeah, again, it's, you know, with $5 swings every week, it seems like, and oil prices, we, like our customers, are just sort of monitoring carefully and running scenarios.
Ciara Dennis: Tough comparable.
Ciara Dennis: Sequentially, but for the remainder of the year, there's there's no signs yet that the our outlook should change our volume expectations.
Ciara Dennis: Growth continued to be driven by West, Texas as Danny said also in the Uinta.
Ciara Dennis: Some growth still in the powder, although we're making investments there in anticipation of 2020. So that's obviously an area where if activity changes for some reason then we can adjust capital accordingly pretty easily.
Ciara Dennis: So yeah again it's.
Ciara Dennis: With $5 swing every week it seems like in oil prices.
Ciara Dennis: Like our customers are just sort of monitor carefully running scenarios, but.
Spiro Dounis: But so far, everything appears to be on track. Great. I'll leave it there. Thanks, Oscar.
Ciara Dennis: So far everything appears to be on track with guidance.
Ciara Dennis: Great I'll leave it there thanks.
Oscar Brown: Thank you.
Ciara Dennis: Thank you.
Keith Stanley: Your next question comes from the line of Keith Stanley with Wolf Research. Please go ahead.
Speaker Change: Your next question comes from the line of Keith Stanley with Wolfe Research. Please go ahead.
Keith Stanley: Hi, good morning. Wanted to start on Pathfinder. If there's any update on contracts in place for the project and how discussions are going with customers. And then, relatedly, are you mainly targeting take-or-pay contracts with third parties on that pipeline, or would it be fixed-fee commitments where you do have some volunteers? Yeah, thanks for that. On Pathfinder, we've been pretty excited. Sort of the conversations have developed better than we hoped. So we're getting a lot of interest from producing customers, but also other midstream players in the water space. And that latter piece is sort of extra gratifying because it just sort of shows the folks that are in the business day to day across different producers are seeing what we see and the very crucial need for this pipeline.
Keith Stanley: Oh, Hi, good morning wanted to start on Pathfinder, if theres any update on contracts in place for the project and how discussions are going with customers and then Relatedly are you mainly targeting take or pay contracts with third parties on that pipeline or would it be fixed fee commitments.
Speaker Change: Where were you do have some volume risk.
Speaker Change: Yeah, Thanks for that and I know we've been.
Speaker Change: Pretty excited.
Speaker Change: The conversations have developed a better then we hope so we're getting a lot of interest.
Speaker Change: Some customers, but also other midstream players in the water space in that latter piece that sort of extra gratifying because it just sort of shows the folks that.
Speaker Change: In the business day to day across different producers are seeing what we see.
Speaker Change: Very crucial need for this pipeline.
Oscar Brown: These are complicated contracts, sort of you're alluding to that. You know, this is a different decision than just, you know, deciding to put an SWD down somewhere and longer term commitments. And we are seeking NBC type commitments. And we're looking at a range of commercial sort of structures. But again, the whole premise of this pipeline was very much in line and why we're excited about it is it's right down the fairway of whether it would be a gas line or an oil line. It's a typical, we've got our anchor shipper in place and a lot of capacity to fill to drive returns sort of north of typical midstream returns.
Speaker Change: These are complicated contracts certain you're alluding to that this is a different decision than just deciding to put an SW detailed somewhere and longer term commitments and we are seeking MVC.
Speaker Change: <unk> type commitments and we're looking at a range of commercial for the structures, but again the whole premise of this pipeline was very much in line and why we're excited about it.
Speaker Change: It's right down the fairway of whether it would be a gas line or an online. It's a typical we've got our anchor shipper in place and a lot of capacity to fill to drive returns sort of north of typical midstream return. So that's our strategy I don't think we'll necessarily see rapid fire series of contracts again, given these are sort of.
Oscar Brown: So that's our strategy. I don't think we'll necessarily see, you know, rapid fire series of contracts. Again, given these are sort of longer term, more complicated commitments. We've also got some time. So, you know, frankly, the longer we go, I think the more challenging the water environment becomes in the Delaware Basin. So time works to our advantage here. And so we're being pretty thoughtful about sort of the incremental shippers and contracts that we're going to take for this pipe. Trying to balance that with not getting too aggressive and damaging our progress. But we're pretty pleased.
Speaker Change: Longer term.
Speaker Change: Complicated commitments, we've also got some times so.
Speaker Change: Frankly, the longer we go I think the more challenging.
Speaker Change: The water environment becomes in the Delaware Basin. So time works toward advantage here, and so were being pretty thoughtful about sort of the incremental.
Speaker Change: Shippers are.
Speaker Change: Contract. So we're going to take for this pipe trying to balance that without getting too aggressive in and damaging our progress but.
Keith Stanley: I mean, it's pretty exciting and it's nice to be validated in a thesis like this that's sort of a multi-year solution. Thank you.
Speaker Change: So we're pretty pleased I mean, it's pretty exciting and it's nice to be validated.
Speaker Change: And the thesis like this that's sort of a multi year solution.
Keith Stanley: That was all for me. Thank you.
Thank you that was all for me.
Speaker Change: Yeah.
Speaker Change: Okay. Thank you.
Jeremy Tonet: And your next question comes from the line of Jeremy Tonet with JP Morgan. Please go ahead. Hi, good morning. Morning. I just wanted to, I guess, think about...
Speaker Change: And your next question comes from the line of Jeremy Tonet with Jpmorgan. Please go ahead.
Speaker Change: Hi, good morning.
Speaker Change: Alright.
Speaker Change: Just wanted to I guess, if you think about the.
Jeremy Tonet: The producer outlook at this point, your producer customer conversations, just wondering how I guess recent where they were at this point that we've seen a lot of changes already during earnings and it seems like it's been very fluid where things have been changing very recently. So just wondering, you know, we've seen some announcements of CapEx cuts and rig drops, you know, across multiple different producers here and just wondering, you know, how recent are your conversations with your producer customers, does it account for, I guess, you know, the number of different updates we've been hearing during That's a great question.
Speaker Change: The producer outlook at this point your producer customer conversations just wondering how I guess recent where they were at this point we've seen a lot of changes already during earnings season. It seems like it's been very fluid where things have been changing very recently, so just wondering.
Speaker Change: We've seen some announcements of capex cuts and rig drops across multiple different producers here and just wondering how recent are your conversations with your producer customers does it account for I guess the number of different updates we've been hearing during earnings season.
Speaker Change: No great question I haven't seen much of our commercial team, they're basically living in customers offices.
Oscar Brown: I haven't seen much of our commercial team. They're basically living in customers' offices, so it's It's pretty real-time, but you're right, it's sort of, it seems like it's day-to-day, the way people are sort of reacting. But in general, I think, look, everybody is sort of running their scenarios. In our customer base, you know, mostly what we've seen is folks looking at different projects. Again, we haven't seen enough activity or change in activity or outlook to change anything around our guidance, including on the CapEx front at this point. And I think even the customers, our customers specifically, that have announced any changes in capital, frankly, haven't adjusted changes in sort of their, you know, vol count, other than, frankly, up, but certainly not production outlook yet.
Speaker Change: It's pretty real time, but you're right it's sort of.
Speaker Change: It seems like it's day to day, the way people are sort of reacting but in general I think look everybody is sort of running those scenarios.
Speaker Change: Our customer base, you know, mostly what we've seen is looking.
Speaker Change: Looking at different projects again, we haven't seen enough activity.
Speaker Change: A change in activity or outlook to change anything around our guidance, including on the Capex front at this point, but I think even the customers.
Speaker Change: Our customer specifically.
Speaker Change: But have announced any changes in capital frankly haven't adjusted changes inside of there.
Speaker Change: Other than frankly up.
Speaker Change: But certainly not production outlook, yet so again, we're just sort of responding accordingly.
Oscar Brown: So, again, you know, we're just sort of responding accordingly. So for now, again, at least with our customer portfolio, we feel pretty good. And everybody's doing exactly like you're saying. The producers who aren't our customers, you know, what we're seeing is what you're seeing, which is some rig drops around sort of the fringes of different geographies and that sort of thing. And a lot of it's sort of performance driven and not necessarily commodity price driven at this point. So, you know, we're ready, right? We're in there every day. And, you know, the good news is we've gotten, let's put it this way, a lot more flexibility in our capital than we would expect to experience on volatility in our cash flows, given our customers and our contract structure.
So for now again at least with our our customer portfolio, we feel pretty good and everybody's doing exactly like you are saying that.
Speaker Change: And producers, who arent our customers. So what we're saying is what you're saying, which is some big drops around the fringes of different geographies and and that sort of thing.
Speaker Change: And a lot of it sort of performance driven and not necessarily commodity price driven at this point so.
Speaker Change: Yeah, we're ready right. We're in there every day and and the good news is we've got let's put it this way a lot more flexibility in our capital and.
Speaker Change: And we would expect to experience some volatility in our cash flows given our customers and our contract structure. So.
Oscar Brown: So, you know, we're pretty confident in the outlook and just monitor the situation. So I don't know if that's helpful, but that's what we're seeing.
Speaker Change: Yeah, we're pretty confident in the outlook and just monitor situations. So I don't know if that's helpful. But that's what we're saying.
Oscar Brown: God, I understood, not to belabor the point and realize it's probably too early to ask, but just wondering, in a scenario with commodity prices, you know, go to the mid-50s or whatever point that leads to flat permian growth and gas growth is just modest. Just wondering, any thoughts you might be able to share on how West might look in that Again, I mean, that's sort of what we're looking at. So I don't think there's, again, not much change from what you're seeing in our guidance. Under that scenario, if customers start dropping rigs or we see lower activity across the basin, I think it more impacts sort of our growth outlook than sort of a big negative impact on our free cash flow.
Speaker Change: Got it understood not to belabor the point and realize it's probably too early to ask but just wondering in a scenario with commodity.
Speaker Change: Commodity prices you know go to the mid fifties or whatever point that leads to flat Permian growth in gas growth is just modest just wondering any thoughts you might be able to share on how that how west might look in that scenario.
Speaker Change: Again, I mean, that's sort of what we're looking at so I don't think there is.
Speaker Change: Again, not much change from what you're saying in our guidance.
Speaker Change: Under that scenario, if customers start dropping rigs or you see lower activity across the basin I think it has more impact sort of our growth outlook.
Speaker Change: And then a sort of a big.
Speaker Change: The big negative impact on our free cash flow and effectively.
Oscar Brown: And in fact, if people want to drop projects on the growth side and we pull back capital, frankly, that just gives us some firepower to be opportunistic on the capital side, cap allocation side that we already talked about. So for us, you know, we don't hope for a slowdown, but I think we come at it with a position of strength and frankly, you know, probably we'll see some opportunities to take advantage of in that scenario too. So, you know, if things hold well or improve to back to where we thought they would be, you know, a few months ago, I think we've got a great organics growth story.
Speaker Change: People want to drop projects on the growth side, and we pulled back capital frankly that just gives us some firepower to be opportunistic on the capital side capital allocation side that we already talked about so for US you know, we don't hope for a slowdown but but.
Speaker Change: I think we come at it with a position of strength and frankly.
Speaker Change: Probably we'll see some opportunities to take advantage of in that scenario too.
Speaker Change: So, yes, if things hold well or or or approved to back to where we thought they would be in a few months ago.
I think we've got a great organic growth story.
Oscar Brown: And if that shifts, then I think we've got, you know, potential consolidation story to work on as well. And of course, we'll keep an eye on the unit price. If that goes out of whack, you know, we'll jump there too. Got it, that's helpful. I'll leave it there, thanks. Awesome, thank you.
Speaker Change: If that shifts and then I think we've got you know a potential consolidation story, but to work on as well and of course, we'll keep an eye on the unit price that goes out of whack, what's up there too.
Speaker Change: Yeah.
Speaker Change: Got it that's helpful I'll leave it there thanks.
Speaker Change: Awesome. Thank you.
Ludi: And once again if you would like to ask a question, simply press star followed by the number 1 on your telephone keypad.
Speaker Change: And once again, if you would like to ask a question. Thank you press the star followed by the number one on your telephone keypad.
Sumantra Banerjee: Your next question comes from the line of Sumantra Banerjee with UBS. Please go ahead. Hi, thank you for taking the question.
Speaker Change: Your next question comes from the line of too much or by energy with UBS. Please go ahead.
Speaker Change: Alright. Thank you for taking the question wanted to go back on a return of capital for a second capital allocation priority is it's great to see that leverage is now below the three times.
Sumantra Banerjee: I wanted to go back on return of capital for a second and capital allocation priorities. It's great to see that leverage is now below the three times target. And so I know you mentioned that you're targeting mid to low single digit distribution increases, but also wanted to ask how buybacks might fit into those priorities. Yeah, you bet. So I guess the way we look at it is, you know, if If the return on our equity is in excess of sort of our organic or inorganic growth opportunities, and it's obviously highly de-risked because we're pretty sure we understand our own business, then it's something we've got to look at and be opportunistic on.
Speaker Change: Target and so I know you mentioned that you were targeting mid to low single digit distribution.
Speaker Change: Distribution increases, but also wanted to ask how buybacks might fit into those priorities.
Speaker Change: Hey, you bet, so I guess the way to look at it as you know it.
Speaker Change: If the return on our equity is in excess of sort of our organic or inorganic growth opportunities and it's obviously highly derisked because we're pretty sure we understand their own business. Then it's something we got to look at would be opportunistic on but right now so far we're seeing.
Oscar Brown: So right now, so far, you know, we're seeing both on the projects that we have in place that customers haven't yet adjusted or give us any signal on the change, those returns are still in excess of what we can earn just by buying back our own stock on a risk-adjusted basis. And it's the same for the moment as to what we're seeing externally as well. So for now, it seems like, you know, you know, our cascade of sort of capital allocation is the same, right? We'd love to pursue organic growth, you know, at our midstream type returns.
Speaker Change: On the projects that we have in place that having the customers haven't yet adjusted or give us any signal on to change those returns are still in excess of what we can earn just by buying back our own stock in a risk adjusted basis.
Speaker Change: The same for the moment as to what we're seeing externally as well so.
Speaker Change: For now it seems like you know our cascade of sort of capital allocation is the same right, we'd love to pursue organic growth at our midstream type returns and then its our inorganic growth sort of M&A and that sort of thing.
Oscar Brown: And then it's inorganic growth, sort of M&A and that sort of thing. And then, you know, of course, the buybacks are in the mix. You know, the whole thing, any, as we've said over and over again, you know, we only allocate capital to sustain or grow the distribution. That's sort of our financial license to operate as an MLP. And so that's our North Star in terms of how we allocate capital. So we'll just keep an eye on it. And, you know, if we exhaust the first two, then of course, you know, buybacks are an option out there as well, especially if there's just uncertainty, right?
Speaker Change: And then of course the buybacks are in the mix you know the whole thing as we've said over and over again, we only allocate capital to some.
Speaker Change: Sustain or grow the distribution, that's sort of a financial license to operate as an MLP.
Speaker Change: So that's our north star in terms of how we allocate capital.
Speaker Change: So we'll just keep an eye on it and I think it's off the first two then of course, yes.
Speaker Change: Buybacks are an option out there as well, especially if there's just uncertainty right. Yeah, we don't necessarily want to lean into.
Oscar Brown: We don't necessarily want to lean into, you know, jumping past our targeted distribution growth. You know, if there's just volatility in the market, you know, then buybacks might make sense. You know, we're also cognizant of, you know, our float is lower than we'd like it to be. And so, you know, buybacks also impact some of the technical trading around our stocks. So we're just always cautious there. But again, it's a great option. I don't really want to see it because it means our stock's going down, but if we can buyback shares at midstream plus returns on a, you know, from our purpose as a risk-free basis, you know, we'll kind of do it.
Speaker Change: Jumping past our targeted distribution growth.
Speaker Change: Theres just volatility in the market than buybacks when it makes sense, but we're also cognizant of.
Speaker Change: Our float is lower than we'd like it to be and so you know buybacks also impacts some of the tactical trading around our stocks or just always cautious there.
Speaker Change: And it's a great option. This I don't really want to see it because I mean, the stock's going down but.
Speaker Change: If we can buy back shares at midstream plus returns.
Speaker Change: From from our purposes, it was pretty basis, what kind of do it.
Speaker Change: Yeah.
Sumantra Banerjee: Got it. That's really helpful. Thank you.
Speaker Change: Got it that's really helpful. Thank you I'll turn it over.
Sumantra Banerjee: I'll turn it over. Thank you.
Speaker Change: Thank you.
Zack Van Everen: And your next question comes from the line of Zack Van Everen with TPH. Please go ahead.
Speaker Change: And your next question comes from the line of Zachary <unk> with T. P. H. Please go ahead.
Zack Van Everen: Hi all, thanks for taking my question. Maybe just going back to M&A, I know you mentioned if, you know, organic projects slow, there's still a lot out there on the inorganic side. Maybe touch on, I know you've talked about this before, but would these be in-basin bolt-ons on the GMP side, or would you guys also look outside the Permian and your current basins for different type of assets? Yeah, I think, so again, nothing's really changed in our thought or strategy around acquisitions. You know, we really believe that to be successful in those, we have to bring something additive to the mix.
Speaker Change: Hi, all thanks for taking my question, maybe just going back to M&A I know you mentioned if organic projects slow there's still a lot out there on the inorganic side.
Speaker Change: Can you touch on I know you've talked about this before but would these be in basin bolt ons on the G&P side or would you guys also look outside the Permian and your current basins for different type of assets.
Speaker Change: Yes, I think so again nothing has really changed in our thought or strategy around acquisitions. Yeah. We really believe that to be successful in those we have to bring something additive to the mix. So that does tend to steer you more likely to and based on opportunities or Pat.
Oscar Brown: So that does tend to steer you more likely to, you know, invasion opportunities or, you know, add-ons to our various products and service teams, service activities. So, again, I think it's, you know, it's going to be pretty much down the fairway, unless there's a customer or something that wants to bring us to a new basin and can really de-risk it for us, and maybe that's the value add we can bring. So it's, you know, it's going to be very likely in our, you know, core businesses and our core geographies, unless something, you know, kind of unusual happens with the way that, you know, we can add value and de-risk a different, you know, opportunity.
Speaker Change: Add on sort of areas.
Speaker Change: Products and service teams service.
Speaker Change: Activity. So again I think it's you know it's going to be pretty much down the fairway.
Speaker Change: Unless there's a customer or something once that wants to bring us to a new basin and can really derisk. It for us and maybe that's the value add we can bring so it's still it's going to be very likely in our core businesses in our core geographies unless something kind of unusual happens with the way that we can add value.
Speaker Change: De risks are different.
Speaker Change: Opportunity.
Zack Van Everen: Got it. That makes sense.
Speaker Change: Got it that makes sense and then one.
Oscar Brown: And then one more quick one. On slide 24, you guys talk about 2.8 BCF a day of natural gas, MVC or cost of service protection, as well as on the crude and NGL side. Have you guys ever broken out, or could you give us some more color on, you know, where these contracts are? Is it mostly permitting and DJ, you know, maybe a percent on which is MVC versus cost of service? I don't think we've broken out that much detail, but obviously the vast majority of MVCs and cost of service are in West Texas and in the DJ, you know, obviously, the Permian market is more of a dedication market.
Speaker Change: One more quick one on slide 24, you guys talked about.
Speaker Change: Two eight Bcf a day of natural gas MVC or cost of service protection as well as on the crude and NGL side.
Speaker Change: Have you guys ever broken out or could you give us some more color on where these contracts or is it mostly Permian and D. J.
Speaker Change: You know maybe a percent on which is M D C versus cost of service.
Speaker Change: Yeah, I don't think we've broken out that much detail, but obviously the <unk>.
Speaker Change: Vast majority of MVC and cost of service or in West, Texas and in the D. J you know obviously, the Permian markets more of a dedication market.
Zack Van Everen: I'm sorry, the Powder River is more of a dedication market, whereas, you know, we've got some great legacy contracts in the DJ and in the Permian. Makes sense. Appreciate the time.
Speaker Change: Oh, sorry, the <unk> sorry, the powder River is more of a dedication market, whereas you know.
Speaker Change: Got some great legacy contracts in the DJ and the.
Speaker Change: Permian.
Speaker Change: Makes sense appreciate the time thanks.
Zack Van Everen: Thanks.
Zack Van Everen: Thank you.
Speaker Change: Thank you.
Ned Baramov: And your next question comes from the line of Ned Baramov with Wells Fargo. Please go ahead. Hi, good morning. Thanks for taking the question.
Speaker Change: And your next question comes from the line of Matt Dharma really Wells Fargo. Please go ahead.
Speaker Change: Hi, good morning, Thanks for taking the question.
Ned Baramov: You know, in a flat-permian production environment, and assuming you pull back your PRB growth projects, which I think contribute to 2026 volumes but are currently included in your 2025 CAPEX guidance, what do you think your spending budget would look like this year? Should we think about CAPEX as the low end of your current CAPEX guidance range, or maybe just closer to sustaining CAPEX levels? Yeah, Kristen can help me out here, but I think in your scenario with permeance black and powder weekends, I think is what you're asking, we would probably, and that happens soon, let's say, because we're almost mid-year as it is, I guess the answer is probably the low end of CAPEX guides, maybe even below that.
Speaker Change: That Permian production environment, and assuming you pulled back your pier b growth projects, which I think contribute to 2026 volumes, but are currently included in your 2025 Capex guidance. What do you think your spending budget would look like this year.
Speaker Change: Should we think about Capex is.
Speaker Change: The low end of your current Capex guidance range, or maybe just closer to sustaining capex levels.
Speaker Change: Yeah, Chris you can help me out here, but I think in your scenario with Permian slide.
Speaker Change: And powder weekends, I think is what you're asking we.
Speaker Change: We would probably.
Speaker Change: So that happens soon let's say because we're almost mid year as it is I.
Speaker Change: I guess the answer is probably the low end of Capex guidance basically maybe even below that.
Oscar Brown: I agree. I mean, I think kind of going back to when you look at our capital spend, there's quite a bit in the PRB. So if you see some type of pullback, and then to Oscar's point, relatively soon, we're very, our capital spend is very dependent on our producers and what they're doing. So we can pretty much delay or cancel or pause most projects if we see changes like that, do that relatively quickly. Understood. Very helpful. Thank you. That's all I had.
Speaker Change: Yeah, I agree I mean, I think kind of going back to when you look at our capital spend quite a bit in the PRP.
Speaker Change: And if you see some type of pullback and into Oscar's playing relatively stand.
Speaker Change: Our capital spend very dependent right are courteous errors and what they're doing so we can pretty much delay or cancel our pie.
Speaker Change: Those projects, if we see changes like that and get that right.
Speaker Change: Understood very helpful. Thank you that's all I had.
Oscar Brown: All right, thank you.
Oscar Brown: Alright, Thank you Andrea affordable since at this time I would like to turn it back to Mr. Oscar Brown for closing remarks.
Ludi: And there are no further questions at this time.
Oscar Brown: I would like to turn it back to Mr. Oscar Brown for closing remarks. Great. Thanks, everyone, for participating on our first quarter 2025 earnings call. We continue to be exceptionally well positioned to navigate a range of business environments, so I'll just reiterate. We have an incredibly strong contract portfolio, excellent assets in the most economic basins in North America, an engaged and resilient workforce, a strong balance sheet with one of the lowest net leverage ratios amongst midstream peers. A nearly 10% deferred distribution yield, our seasoned leadership team, strong board oversight, and a solid, prudent strategy underpinned by organic growth projects.
Oscar Brown: Great. Thanks to everyone for participating on our first call. The first quarter of 2025 earnings call. We.
Oscar Brown: We continue to be exceptionally well positioned to navigate a range of business environments. So I'll just reiterate it.
Oscar Brown: Incredibly strong contract portfolio excellent assets in the most economic basins in North America, and engaged and resilient workforce, a strong balance sheet with one of the lowest net leverage ratios amongst midstream peers.
Oscar Brown: And nearly 10% deferred distribution yield our seasoned leadership team strong board oversight.
Oscar Brown: It sounds prudent strategy underpinned by organic growth projects one of the thank you again, our incredible employees for supporting efforts to increase our competitiveness and their focus on our mission our license to operate and our differentiating capabilities all while operating safely efficiently and responsibly I would also like to thank our customers for their <unk>.
Oscar Brown: I wanted to thank again our incredible employees for supporting the efforts to increase our competitiveness and their focus on our mission, our licenses to operate, and our differentiating capabilities, all while operating safely, efficiently, and responsibly. I would also like to thank our customers for their continued support and their trust in West to provide flow assurance and creative midstream solutions.
Oscar Brown: Support and their trust in West provide flow assurance and creative midstream solutions.
Oscar Brown: We look forward to seeing everyone at upcoming energy conferences this month.
Oscar Brown: Look forward to seeing everyone at upcoming.
Oscar Brown: Conferences, this month and with that we'll close the call. Thanks again.
Oscar Brown: And with that, we'll close the call. Thanks again. Thank you.
Ludi: And this concludes today's conference call. Thank you all for joining.
Oscar Brown: Thank you and this concludes today's conference call. Thank you all for joining you may now disconnect.
Ludi: You may now disconnect.