Q3 2025 Keyera Corp Earnings Call

Paul.

All lines have been placed on mute to prevent any background noise.

After the Speakers' remarks, there will be question and as a recession. If you would like to ask a question. During this time simply press Star then the number one.

If you would like to withdraw your question. Please press Star then the number two thank you.

I'd like to turn the call over to Mr. John God person as general manager of Investor Relations you may begin.

Thank you and good morning, joining me today will be Dean Setoguchi, President and CEO.

Eric <unk>, our senior Vice President and CFO, Jamie Burke, Senior Vice President and Chief Commercial Officer, and Jared with Tony <unk> Senior Vice President operations and engineering, we will begin with some prepared remarks from Eni after which we will open the call to questions I would like to remind listeners that some of the comments and answers that we will get to.

Dean Setoguchi: Thirdly, I think with the Plains acquisition, we're going to really enhance our market access, especially out to the east, which is really going to complement the markets that we can serve already in the west and also locally, especially with our condensate system and our iso-octane business. Our propane access is going to be much stronger with the Plains business. Again, that's going to be another positive tailwind for our marketing business.

They relate to future events. These forward looking statements are given as of today's date and reflect events or outcomes that management. Currently expects. In addition, we will refer to some non-GAAP financial measures for additional information on non-GAAP measures and forward looking statements. Please refer to <unk> public filings available on SEDAR and on our website.

With that I'll turn the call over to Dee.

Robert Hope: Okay, thanks, everyone, for the answers. I'll turn it back.

Thanks, Dan and good morning, everyone.

This quarter again demonstrated the strength of our fee for service business were realized margin grew by more than 10% year over year.

Dean Setoguchi: Thank you.

Operator: Thank you. Your next question comes from the line of Robert Cuthbertson from CIBC. Please go ahead.

This continued increase in stable cash flow reflects higher utilization across our integrated system and supports ongoing dividend growth.

Robert Cuthbertson: Hey, good morning, everyone. I wanted to follow up on Robert Hope's first question and just the practical implications of timing on the Plains transaction. My question is, what's the likelihood that the transaction closes in time for Keyera to go to market for the 2026 contracting year on a more integrated basis?

2025 has been a defining year for Kira built on several years of disciplined execution of our strategy to extend and strengthen our value chain.

We built a highly competitive integrated platform that continues to attract customer volumes and support long term growth.

Dean Setoguchi: Well, that's a good question. At the end of the day, we are certainly, the bureau process is that review is proceeding as we would have expected. This is a large acquisition. With any large acquisition, it takes time, and that timing isn't always certain. We believe that we're still on track to get through that process in the first quarter and close. It would be nice if we could have it closed before contracting season, but that still remains to be seen. That's obviously not 100% within our control.

This year alone we've secured more than 100000 barrels per day of new contracting on caps and our existing and planned fractionation capacity is now substantially contracted.

Those wins, demonstrating the value customers place on our services.

We're also making solid progress on our major growth projects.

<unk> to Debottleneck factory expansion and capstone for our each advancing on time and on budget.

Together they will further strengthen our integrated system and provide stable long term fee for service cash flow supported with a significant portion of take or pay contracts.

Robert Cuthbertson: Yeah, that'd be great for the customers as well. Just a bigger picture here, just looking at CAPS, and we don't know the ultimate size of the pipeline, but my question is, given your view of base and growth, which is similar to ours and pretty strong, what is possible in terms of an expansion of CAPS in terms of the timeline? Is that possible without a material Gathering and Processing expansion by Keyera?

Pending acquisition of planes Canadian NGL business, we'll build on that foundation.

It adds meaningful scale expands our reach to key demand hubs in the east.

And allows us to offer customers more flexibility and connectivity across the value chain.

The transaction remains on track and we expect to close in the first quarter of 2026.

Turning to the marketing segment.

The quarterly results and full year outlook came in below expectations.

Dean Setoguchi: I love the question. It wasn't just like two quarters ago you guys were asking us how we're going to fill CAPS, and now you're asking us how we're going to expand it. I mean, hey, with the contracts that we've signed, yes, I mean, CAPS by the end of the decade is going to start to get pretty full, which is very exciting and tells how competitive our system is, and the demand for that service. Maybe I'll turn that question over to Jared.

The segment remains strategically important to our business.

It provides strong cash flow.

And in some years delivers exceptional contributions.

That cash has helped us strengthen our balance sheet and accelerate growth in our fee for service business.

Further compounding value for shareholders.

I want to briefly touch on our sustainability progress we met our 2025 GHT intensity reduction target of 25% of full year ahead of schedule.

Jamie Urquhart: Yeah, good morning, Robert. I think that's really been always part of the plan, to add particularly pump station capacity as the volumes warrant it. That's really what we're doing. There's some of that coming along with Zone 4, and we expect that'll continue out through the end of the decade. We still have some runway there to do some very capital-efficient expansions through additional pumping before we'd have a step change in capital beyond that.

This has been accomplished through economic investments that improve efficiency and meter long meet our return thresholds.

More importantly, our sustainability program focuses on managing long term risks and.

And positioning the company for lasting value creation.

Robert Cuthbertson: Okay. Last one for me, just on the bigger picture, Dean, what are you seeing in terms of how the basin is changing? We've had some more producer consolidation recently, but we're also seeing maybe a different approach towards LNG with the major projects office putting another project on there. Just when you look at those things together, how is the customer interaction and maybe the growth outlook changing?

We published our 2024 sustainability performance summary on our website.

Overall 2025 has been a year of strong execution.

We've continued to build a more efficient and competitive platform that creates meaningful value for customers and shareholders, while positioning <unk> for long term growth.

With that I'll turn the call over to <unk> to review, our financial results and outlook.

Dean Setoguchi: Yeah, I mean, I feel a lot more optimistic today than I have in a long, long time. It's encouraging to hear some positive comments come from our Prime Minister and some actions in the right direction. I think it's great for Canada if we can continue to develop more LNG off the West Coast. Certainly, hey, we'll benefit from that because we have critical infrastructure that helps enable that basin growth. I think there still needs to be some progress on key policies that would, again, just give everyone a lot of confidence that we can do this in a competitive manner. When you think about it, I think the basin is going to grow. I should also mention, too, it's exciting that Enbridge is finding ways to add more capacity on their system.

Thanks, Dean and good morning, everyone <unk> third quarter results reflected stable performance and continued strength in our fee for service businesses.

Not including deal and integration costs associated with the Plains acquisition adjusted EBITDA was $286 million distributable cash flow was $186 million or <unk> 81 per share.

Net earnings were $85 million.

As Steve mentioned, we continue to see strong year over year growth in our fee for service segment, driven by higher utilization across the value chain.

Gathering and processing realized margin was $112 million up from $99 million last year, the increase reflects higher throughput and growing contributions from our wapiti and Simon at plant at contracted volume continues to grow.

Not including deal and integration costs associated with the claims acquisition adjusted ibida with 286 million. Distributable cash flow was 186 million or 81 cents for share

And net earnings were 85 million.

And liquids infrastructure realized margin was $147 million compared to $135 million last year supported by higher storage and utilization of our condensate system as well as the steady ramp up of cap volume.

As Dean mentioned, we continue to see strong year-over-year growth in our fee-for-service segments, driven by higher utilization across the value chain.

Dean Setoguchi: We know that TMX Trans Mountain has the ability to also de-bottleneck too. I think this bodes well for industry and for Canada, which is great, and helps us boost our economy. When we think about consolidation, the way I think about it is that as an industry, we should be working together to create the most competitive, low-cost, and environmentally friendly energy to serve the world. With some of the consolidations that we're seeing, I think it's good because it creates more size, scale, and efficiency to help accomplish that. For Keyera as a midstream service provider, we're doing the same thing. That's what Plains is all about. We're consolidating, and we're going to be more efficient. We're going to provide a more competitive service, and that's going to make our basin more competitive.

Now turning to the marketing segment.

Realized margin was $73 million for the quarter compared to $135 million last year.

The lower results reflect reduced condensate import volumes at domestic production displaced U S imports.

While this shift benefits our fee for service business, it reduced marketing opportunity liquids blending activity and isooctane premiums were also lower.

Liquid infrastructure realized margin was 147 million compared to 135 Million last year supported by higher storage, and utilization of our condensate system as well as the steady ramp up of caps volumes.

Now, turning to the marketing segment.

For the full year, we now expect marketing realized margin to range between $280 million at $300 million results would have been within our long term base guidance range without the approximate $50 million impact from the unplanned outage.

Realized margin was 73 million for the quarter compared to 135 Million last year.

Outage earlier in the year.

We are reaffirming our long term annual based marketing guidance of $310 million to $350 million. This is based on certain commodity price assumptions and aes operating at nameplate capacity.

Dean Setoguchi: That should help us export more products with additional market access that we're going to be getting in the future. I think it's a good thing overall.

The lower results reflect reduced condensate import volumes as domestic production displaced U.S. imports. While this shift benefits our fee-for-service business, it reduced marketing opportunities, liquids blending activity, and isolating premiums were also lower.

During the quarter, we issued $2 3 billion of senior notes and $500 million of hybrid notes, which completed the financing requirements for the plains acquisition.

Robert Cuthbertson: Okay, great. Thank you very much.

Dean Setoguchi: Yeah, thanks for the questions. Have a good weekend.

Operator: Thank you. Your next question comes from the line of Theresa Chen from Barclays. Please go ahead.

For the full year. We now expect marketing realized margin to range between 280 million, and 300 Million results would have been within our long-term base guidance range. Without the approximate 50 million impact from the unplanned AF outage earlier in the year.

Now I'll touch on our capital outlook and guidance update for 2025, we have made a few adjustments.

Theresa Chen: Good morning. Just a quick follow-up one from me on the Marketing segment. Octane premiums seem to be improving so far in Q4 2025, despite what should be a seasonally soft period. What are some of the factors contributing to this dynamic in your view? Is it octane demand related, alluding to some of the long-term trends you mentioned earlier? Have there been supply disruptions in octane observed in the market?

<unk> capital is now expected to range between $220 million and $240 million down from our previous estimate of 275 million to $300 million. The change reflects the deferral of some spending to 2026. This does not impact expected in service dates of our major projects.

We are reaffirming our long-term annual base marketing, guidance of 310 million to 350 million. This is based on certain commodity prices assumptions and AES operating at Main plates capacity.

During the quarter, we issued $2.3 billion of senior notes and $500 million of hybrid notes, which completed the financing requirements for the planes acquisition.

Yeah.

Maintenance capital is now expected to be 60 million to $70 million slightly lower than before again, reflecting timing shifts.

And cash taxes are expected to come in between $90 million and $100 million, primarily due to lower marketing contribution.

Dean Setoguchi: Hey, good morning, Theresa. You're very astute to be watching that market. I'll turn that over to Jamie to provide more color on it.

Looking ahead to 2026 were providing standalone guidance until the plains transaction closes.

Jamie Urquhart: Yeah. Good morning, Theresa. As Dean said, yeah, you're bang on. Q4 premiums are actually trading above historical levels. Our view is that it's really attributed to both the supply and the demand side. On the supply side, we're seeing some significant refinery outages, also some closures of refineries, specifically on the West Coast, which is an area where a lot of our products in the Western US are sold. Also, demand is being strong. Certainly, our Bob cracks as well have really had some tailwinds over the last period of time. It's interesting with respect to gasoline pricing, and octanes are not necessarily always limited to North America and what's going on in North America. Long term, we have a really strong view that both our Bob cracks and iso-octane premiums, octane premiums, are going to be robust.

Now, I'll touch on our Capitol Outlook and guidance updates for 2025. We've made a few adjustments to growth. Capital is now expected to range between $220 million and $240 million, down from our previous estimate of $275 million to $300 million. The change reflects the deferral of some spending to 2026.

We remain on track to deliver our 7% to 8% compound annual growth rate in fee based adjusted EBITDA from 2024 and through 2020.

This does not impact the expected in-service dates of our major projects.

The maintenance capital is now expected to be between $60 million and $70 million, slightly lower than before, again reflecting some timing shifts.

Roth capital for 2026 is expected to range between 400 million and $475 million, mainly directed toward our sanction growth projects.

And cash. Taxes are expected to come in between 90 million and 100 million primarily due to lower marketing contributions.

Maintenance capital for 2026 is expected to range between $130 million and $150 million, which includes about $60 million for the planned six week turnaround at Aes starting in September.

Looking ahead to 2026 or providing Standalone guidance until the planes transaction closes.

We remain on track to deliver our 7 to 8% compound annual growth rate in fee-based adjusted EBITDA from 2024 through 2027.

Following closing of the Plains acquisition will provide pro forma guidance and a comprehensive business outlook for the combined platform, reflecting enhanced scale and long term growth profile with that I'll turn it back to Dave for closing remarks. Thanks.

Growth capital for 2026 is expected to range between 400 million and 475 million. Mainly directed toward our sanctioned growth projects.

2025 has been a transformative year for <unk>.

We've executed on our strategy strengthened our value chain and continue to build a competitive and efficient platform that creates value for customers and shareholders.

Maintenance capital for 2026 is expected to range between $130 million and $150 million, which includes about $60 million for the planned six-week turnaround at AES starting in September.

Jamie Urquhart: They're going to continue to be above historic levels, not to the levels that we would have seen in 2022 or through 2024 based on some very unique geopolitical events on the planet. We expect that the strength in iso-octane premiums will persist into 2026.

With a fully financed plan and self funded growth ahead, we are well positioned to support the continued growth of the basin and deliver strong fee for service margin growth for years to come.

Following closing of the plane's, acquisition will provide pro-forma guidance and a comprehensive business outlook for the combined platform, reflecting its enhanced scale, and long-term growth profile with that. I'll turn it back to Dean for closing remarks.

Thanks Eileen.

On behalf of our board and management team I want to thank our employees customers shareholders indigenous rights holders and other stakeholders for their continued support.

2025 has been a transformative year for Kiara.

Eileen Marikar: Thank you.

With that we'll open the line for questions. Operator. Please go ahead.

We've executed under strategy, strengthened our value chain, and continue to build a competitive and efficient platform that creates value for customers and shareholders.

Operator: Thank you. Your next question comes from the line of EJ O'Donnell from TPH. Please go ahead.

Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by the one on your telephone keypad Cumulus.

EJ O'Donnell: Hey, morning, everyone. I was hoping to maybe just start on the macro and just kind of what's going on right now in Q4. Wondering if you could talk to maybe some of the activity levels you're seeing across the north and south in light of LNG Canada starting to ramp up that second train and AECO prices starting to improve.

With a fully financed plan and self-funded growth ahead. We're well positioned to support the continued growth of the Basin and deliver. Strong fee for service margin rules for years to come

You will hear a problem that Johan has been released and should you wish to cancel your request. Please press star followed by the two if you are using a speaker phone. Please lift the handset before pressing any Keith one moment. Please for your first question.

On behalf of our board and management team, I want to thank our employees, customers, shareholders, Indigenous rights holders, and other stakeholders for their continued support.

With that, we'll turn. We'll open the line for questions. Operator, please go ahead.

Dean Setoguchi: Yeah. Good morning, EJ, and thanks for the question. I think from a big picture standpoint, I mean, most of the growth in the basin has been and will continue to happen up in the Montney. A lot of value is derived from the liquids. Even though they are up in that area, it is not really that sensitive to natural gas prices. It is probably more sensitive to crude oil prices. Even at $60 WTI for condensate, roughly, you multiply that by the FX rate in Canadian dollar terms, it is still a pretty good price, which is still a good price incentive for producers to continue to drill and grow. I think up in that area too, there is not as much infrastructure capacity, and that is from gas plants all the way through that value chain.

And your first question comes from the line of <unk> <unk> from Scotiabank. Please go ahead.

Good morning, everyone.

Thank you, ladies and gentlemen, we will now begin the question and answer session. Should you have a question please press star followed by the 1 on your telephone keypad?

So good to see the continued growth in gathering processing cash flows even with the weakness in heiko.

As you look at your northern footprint and the increasing volumes. There how are you thinking about further optimizations or expansions.

You will hear a prompt that your hand has been raised, and should you wish to cancel your request? Please press star. Followed by the 2. If you're using a speaker-phone, please leave the handset. Before pressing any Keys 1 moment, please for your first question.

Good morning, Rob Yeah. Thank you very much for the question.

We see our northern footprint as being really in the most economic fairway of the Montney liquids rich.

And your first question comes from the line of Robert Hope from Scotia Bank. Please go ahead.

Fairway of the Montney. So we do see continued growth in demand for our services in that area and that's exactly why youre seeing continued volume growth, even with weak natural gas prices, because again the values and the liquids.

Uh, good morning everyone. Um, so good to see the continued growth and Gathering process, and cash flows, even with the weakness in Echo, you know, as you look at your Northern footprint and the increasing volumes there, how are you thinking about further, optimizations or expansions?

We think that we're going to have opportunities to continue to not only fill the remaining capacity that we have up there, but also to expand and build new capacity.

Good morning, Rob. Uh yeah, thank you very much for the question.

Dean Setoguchi: Whenever you have scarcity of supply, the producers want to make sure they secure that in order to fulfill their growth plans in the future. What we can say is that demand has been very high for the remaining capacity that we have. We expect to continue to add volumes and grow even in the price environment that we're in. Obviously, adding the second train at LNG Canada is going to help. We're going to look beyond that, and we think that there's going to be more LNG developed off the West Coast, which is going to, again, create further demand for more processing capacity and CAPS service in our downstream business. Overall, we think that demand will remain strong. In the south, I think that's where it's a little bit more sensitive to natural gas prices.

It's something that we're we're extremely excited about and.

Again, a lot of that development is going to continue with the with the continued announcements of new new LNG capacity off the west coast of Canada.

I'll also turn it over to Jamie.

Our comments, yes, Dean thanks for the opportunity Robert I think the one thing I'd point out is that.

We haven't really strong gathering interconnectivity between the three facilities that we have in the north so as we look at.

The opportunity to Debottleneck and expand specifically Walker the assignment.

What we're finding is as the demand by the customers in that area for both short term and long term processing.

<unk> solutions, and we think we're going to be able to.

Dean Setoguchi: Our volumes have been relatively steady, especially when you consider what ACO prices have been. I think that if we catch a little bit of a period with stronger gas prices, I'm sure the producers down there are probably hedging forward too with some of the curves that you can see. There's a lot of gas still in place down in the south. Over time, we expect that to get drilled up and see some more volume growth there as well. Anything you want to add, Jamie?

You know, we uh, we see our Northern footprint as being really in the the most economic Fairway of the Monte, the liquids, Rich, uh, Fairway of the Monty. So we do see continued growth and demand for our services in that area. And that's exactly why you're seeing. Uh, continued volume growth even with weak natural gas prices. Because again, the the values in the, uh, in the liquids. Um, you know, we think that we're going to have our opportunities to continue to not only fill the remaining capacity that we have up there but also to expand and build new capacity. So it's something that we're you know we're extremely excited about and uh and again a lot of that development is going to continue with uh with the continued announcements of new uh new LG capacity off the west coast of Canada. But uh I'll also turn it over to uh to Jamie at any other comments. Yeah, Dean thanks for for the opportunity. Robert. I think the 1 thing I'd point out is

Do some capital efficient you bottlenecks at those facilities to enable them both to continue to grow in the short term and then potentially have a line of sight to be able to pursue a new facility in that area as well.

Alright, that's helpful.

Maybe more broadly on the liquids contracting strategy you are quite active securing contracts.

Is that um we have really strong Gathering interconnectivity between the 3 facilities that we have in the north. So as we look at um the opportunity to to debottlenecking and symonne, um, you know, what we're finding is is a is a demand by the customers in that area for both short term and long term processing.

I will call it in the first half of the year less so with this update has the pending acquisition of planes.

Jamie Urquhart: Yeah. The only thing I'd add is I agree with everything Dean said on the north. In the south, I think we're seeing some really positive tailwinds there. As a result, there was a bunch of consolidation two, three years ago. It takes a company a period of time to understand the resource that they're inheriting and ultimately putting drilling programs together. What we've seen is those companies then really starting to get after what they purchased two, three years ago and seeing some very, very good results as a result of applying their technology, their competency. Frankly, one of the reasons why they would have bought those assets is because they believe they could do bigger things with the land base and the prospectivity of those assets. We are seeing some really positive results in the south as well.

Added some complexity to the contracting strategy, just given you're going to have more optionality.

And I guess another question there would be how would the addition of claims impact to contracting strategy moving forward.

Um, Solutions, and we think we're going to be able to, you know, do some capital-efficient um debits at those facilities to enable them both to continue to grow in the short term and then potentially have a line of sight to be able to pursue a new facility in that area as well.

Yes.

That's a great question I mean first of all.

The Plains acquisition is proceeding and we certainly believe that we will be closing sometime in Q1.

But right now we're operating <unk> as a totally separate entity.

And as you would've seen in or we.

We don't provide.

All right, that's helpful. Um, maybe more broadly on the liquids. Contracting strategy, you were quite active securing contracts. Uh, you know, we'll call it in the first half of the Year less. So with this update has the pending acquisition of planes. Um, you know, added some complexity to the Contracting strategy. Just giving you are going to have more optionality. And I guess another question there would be, how would the addition of planes? Uh, impact, the Contracting strategy moving forward?

Every quarter, an update on what we have contracted but I can tell you that there's continued momentum to the contracting on our on our asset base beyond what we've we've announced previously this year. So again. It just tells you how competitive our services are and the demand there is very strong.

EJ O'Donnell: Okay. Great. Maybe just one more kind of on the medium or longer term. We've seen a handful of refined products pipelines being announced in the US, pulling from PADD 2 and then going into some of those refinery closure markets that you talked about into PADD 5. I'm just curious, as you guys kind of think about your iso-octane business, how you anticipate either one or multiple of these projects impacting those margins or having an impact on that business?

So we're going to continue to do that I think with the combination of chiaro work, our <unk> claims were going to be able to provide.

Yeah. No, that's a, that's a great question. I mean, first of all, uh, you know, the, the planes acquisition is proceeding and we we certainly believe that uh, we'll be closing sometime in q1. Um, but right now we're we're offering kiier as a as a totally separate entity and as you would have seen in our in our, like, we don't provide

And even more diversified service in terms of market access, but also with the size and scale and the synergies between.

Our asset basis, we're going to be able to provide a more competitive service for our customers and.

Dean Setoguchi: Yeah, that's a good question.

Jamie Urquhart: Yeah. I love the fact that you guys are on top of our business because, yeah, there are two pipelines that are being proposed, refined pipelines that are being proposed to serve sort of the Nevada, Arizona, but primarily the California market. The California market is seeing some refinery closures happening, and that's really creating a pull for those refined products likely out of Texas and even further to the east. Those two projects, we think, have a lot of merit. We currently serve a bunch of the refineries that would have connectivity, and we would expect to supply into the markets that they're being built into. We have relationships. Net, we see that as a very positive development for our business on the iso-octane front.

That's good obviously.

Lead to more contracting on the combined platform.

Jamie if you want to add.

Perfectly.

Alright, that's great. Thank you.

Yes, thanks, very much have a good day.

Thank you and your next question comes from the line of Aaron Macneil from TD Cowen. Please go ahead.

Hey, good morning, all thanks for taking my questions I fully appreciate that this may be front running some of the disclosures you plan to provide post planes, but as.

Every quarter, an update on what we've contracted. But I can tell you that there's continued momentum to, uh, the Contracting on our on our asset base, uh, beyond what we've we've, uh, announced previously, uh, this year. So again, it just tells you how competitive our services are. And the demand there is is uh very strong. Um so we're going to continue to do that. I think with the combination of Kiara or sorry with planes, we're going to be able to provide uh an even more Diversified service in terms of Market access. But also with the size and scale and the the synergies between um our our asset basis, we're going to be able to provide uh a more competitive service for our customers and um and you know that's going to obviously uh lead to more Contracting on the combined platform.

As we think about a refreshed three year guide with 2025 as the base here should we think about 2028 is a consequential year for growth for kiera on a standalone basis, just given the timing of contracts associated with <unk> zone, four and <unk> three and can you give us a sense of the potential magnitude although.

Jamie, anything else you want to add? No, I think you hit hit it. Um, perfectly de

All right, that's great. Thank you.

Yeah. Thanks very much and have a good day.

Dean Setoguchi: We like the markets that are served, the continental markets that aren't served off the water because we're advantaged. We're moving our rail cars down south, so we can certainly save on the transportation cost if we don't have to take it all the way to the US Gulf Coast, and we can hit one of those inland refineries, or places where they blend gasoline. We like the developments of what's happening with the closures in California of refineries, and also the gasoline demand growth that we're seeing, as Jamie discussed, in Arizona, Nevada, Salt Lake City, that area, and also in the Denver area as well.

Thank you, and your next question comes from the line of Aaron McNeil from Kitty Cowen. Please go ahead.

Other things being equal.

Yes, you are front running us but.

I think it's a very good question.

We've guided up to 2027 and Thats, the 7% to 8% fee for service based growth.

Again, a lot of that is investments that we've already made and we're we're just feeling.

That capacity.

I'd say on top of that obviously.

Hey, good morning. All thanks for taking my questions. I fully appreciate that this may be front-running some of the disclosures you plan to provide post-planes, but as we think about a refreshed three-year guide with 2025 as the base year, should we think about 2028 as a consequential year for growth for Keyera on a standalone basis? Just given the timing of contracts associated with Cap Zone 4 and KFS 3. And can you give us a sense of the potential magnitude, all other things being equal?

As we've announced the capstone for in our two Frac projects are highly contracted with high take or pays so youre going to see a lot of cash flow growth in 2020.

EJ O'Donnell: Okay, thank you very much for the detail. I'll turn it back.

Dean Setoguchi: Thank you.

27, and beyond as those projects come into service and volumes ramp up.

Operator: Thank you once again. Should you have a question, please press star followed by the one on your telephone keypad. Your next question comes from the line of Maurice Choi from RBC Capital Markets. Please go ahead.

Oh, yes.

That's going to be very good for our fee for service business. We have provided guidance on that yet but that will come in the future and then on the claim side.

Maurice Choy: Thank you. Good morning, everyone. Just wanted to think about the world beyond the Plains transaction, and then more big picture about how you view partnerships. Can you talk to what's worked well, what you'll be looking for when establishing a new partnership? Alternatively, maybe you don't see that many new partnerships being formed over the coming years.

We've announced that.

Obviously, you know, we, as we've announced the cap, Zone 4, and our two frac projects are highly contracted with high taker pays.

Our plan is to deliver I'll say at least $100 billion of synergies.

Then we have a clear line of sight to that.

So, you're going to see a lot of cash flow growth in 2027 and beyond, as those projects come into service and volumes ramp up.

Just on where we are in.

Yes.

Put.

Some physicians, we have an arrangement in place where we have very good certainty on the frac spread for the first year of <unk>.

Dean Setoguchi: Yeah, good morning, Maurice. It's a really good question. I think one thing that we have a reputation for is that we're a good partner. We work well with others. We understand the need for a win-win if we want to have a successful partnership that's sustainable. When we look at our business in the long term, I think that we really believe in the value of partnering with indigenous groups and recognizing that they have unique needs and investment criteria. When I think about future partnerships and if there's an opportunity that, again, would work for us and work for them, it's something that I think that we should definitely be exploring.

The acquisition when we close the planes. So we're very confident on our mid teens DCF accretion.

And beyond that like I say, we see a lot of opportunity to create further synergies beyond the $100 million. So.

When you add all that up.

Oil is down to is that I think it's going to be very exciting for kira with our both our internally.

<unk> projects, but also the combination of planes and creating a more efficient platform, that's going to translate to better service and more profitability for our shareholders.

So I'm not trying to Dodge your question I think at the end of the day, we will be providing more guidance in the future. We have to get obviously the closing with plains first before we can disclose that have been mentioned.

So, yes, uh, you know, that's going to be very good for our, our fee for service business. Uh, we have provided guidance on that yet but you know, that'll come in the future. And then on, on the plain side, you know, we've we've announced that, uh, you know, our our plan is to deliver. I, I'll say at least 100 million of synergies. Um, and, you know, we have a clear line of sight to that, you know, based on where we are and and we've, we've, um, put, uh, some positions. We have an arrangement in place where we have very good certainty on the Frac spread for the first year of uh, of acquisition when we, when we close with planes. So we're very confident on our mid- teens, uh, DCF accretion and, uh, and beyond that. Like I say, we we see a lot of opportunity to create further, Synergy beyond the 100 million. So when you add all that up, uh what it boils down to is that I think it's going to be very

Okay fair enough I had to try.

Maurice Choy: Understood. If I could just finish off on the marketing side of the business, I think you touched on the AEF turnaround. You touched on the strengthening cracks, as well as iso-octane premiums. Anything in terms of the market dynamics that you highlighted today for marketing that you think will continue negatively into the new year, or do you think most of that will unwind?

Sure.

Reiterate you reiterated the long term based marketing guide how does the planned turnaround at Aes fit into that next year.

Very exciting for Kiara with our both our internally uh internal projects but also the combination of planes and creating a more efficient platform that's going to translate to better service and more profitability for our shareholders.

Thanks, Darrin, it's Liam here.

Thanks for the question.

Just maybe stepping back looking at this year.

Historically, our isooctane margins have made up more than 50%.

So, I'm not trying to doubt your question. I think, at the end of the day, we will be providing more guidance in the future. Um, we have to get, you know, obviously the closing with planes first before we can, um, disclose that type of information.

The marketing and you know based on fundamentals that we see for isooctane, we expect it to remain strong and if not for the seven week unplanned outage at Aes the impact of $50 million, we would've been well within our base guide if not near the top end of that so all of that.

Dean Setoguchi: Yeah, I'll turn that over to Jamie.

Jamie Urquhart: Yeah. Sorry, Maurice. To understand your question, is there any negative market dynamics that we expect to persist?

Dean Setoguchi: They'd like to carry on. Yeah.

Okay, fair enough. I had to try, um, to reiterate the long-term base marketing guide. How does the plan turn around at AF fit into that next year?

Jamie Urquhart: Yeah. We did highlight the fact that we've seen a reduction in condensate imports into Western Canada. That's something that we think is likely short-lived based on the oil sands growth and the demand for diluent. Other than that, we're very bullish with respect to the demand for spec propane in particular, and excited about the export deal that we put in place with AltaGas. As Dean said, getting the assets from Plains to access to markets in Eastern Canada and the US. Yeah, no, we don't see any major headwinds on the commodities that we touch for our marketing business going forward.

To say, we feel very confident in that in that long term base guidance. So you're right base. When we look at the assumptions that underpin that one of the key assumptions is that operate near capacity and certain other commodity price type of assumptions, especially around <unk>.

So next year, you're absolutely right that there is a six week planned turnaround that that would certainly play into that guidance and so we again next year, we will provide.

Guidance as we normally would.

Anthony as we close out our supply season.

Thanks Aaron. It's Eileen here. Um thanks for the question. You know, just maybe stepping back looking at this year. Um you know historically our ISO octane margins have made up more than 50% of of the marketing. And you know, based on fundamentals that we we see for for, for is to Octane. We expect it to remain strong and if not for the 7 week, unplanned outage at AEF, you know, the the impact of 50 million we would have been well within our base guide, if not near the top end of it. So all that to say we feel very confident in that in that um, long term base guidance. So you're right based when we look at the assumptions that underpin that 1 of the key is something

Yeah, and I'd, just maybe add to that I mean, when you look at the Big picture.

We feel pretty good about our marketing business and again, it's a it's a physical business.

Dean Setoguchi: Yeah, I just say, though, that I think everything's all relative. If you compare it to 2023 and 2024, those were outsized years. I mean, we delivered CAD 480 million, CAD 485 million in those years. We certainly don't want anyone to think that that's the norm. I think we have a business that there will be years where we have outsized performance. I just want to make sure that everyone understands that we have the discipline when we have those outsized years. We take those extra Marketing dollars, and we pay down our debt. That in our free cash flow afforded us the ability to sanction our KAPS Zone 4 or two Frac projects and also pursue Plains, the Plains Canadian NGL business, which really is a big game changer for our company.

So when you think about our frac expansions what it means is that we're going to be touching and marketing more barrels and making margin off of those incremental barrels. So I think that's a bit of a tailwind when you think about our ISO octane business, we think thats pretty strong and again the demand for premium grades of gasoline or.

Ions. Is that aaf operates near capacity and, and certain other commodity price type of, um, assumptions, especially, around WTI. So, next year, you're absolutely right that there is a 6 week planned, uh, turnaround, that, that would certainly play into that guidance. And so we again next year, we will provide, um, guidance as we normally would, um, as we as we close out our supply season,

Increasing.

And certainly with some of the policy changes in the United States.

The demand for gasoline and <unk> and.

The demand for internal combustion Boston engine vehicles is much higher than what anyone would've expected even a couple of years ago. So I think that that bodes pretty well there and thirdly.

With the <unk> acquisition, we're going to really enhance our market access and especially out to the east which is really going to complement.

Dean Setoguchi: I think we have to think about marketing and our business in a more holistic, macro manner and what it does for overall business. It's been a very successful model from day one, and I think it will be in the future as well.

The markets that we can serve already in the west and also locally, especially with our condensate system, our isooctane business. Our propane access is going to be much stronger with the claims business. So again thats going to be another.

Positive tailwind for our marketing business.

Maurice Choy: That makes sense. Thank you very much.

Okay. Thanks, everyone for the answers I'll turn it back.

Dean Setoguchi: Yeah, thanks very much. Have a great weekend.

Okay. Thank you.

Yeah, and I I just maybe add to that. I mean, when you look at the big picture, you know, we we feel pretty good about our our marketing business and again it's a it's a physical business. So when you think about our Frac expansions, what it means is that we're going to be touching and marketing more barrels and and making margin off those incremental barrels. So I think that's a bit of a Tailwind. When you think about our ISO octane business, we think that's pretty strong when you and and again you know, the demand for premium, uh, grades of gasoline are increasing and certainly with the, some of the policy changes in the United States, uh, the demand for gasoline and and um, you know, the demand for our, uh, internal combustion, engine Vehicles is much higher than what anyone would have expected even a couple years ago. So, I think that that votes pretty well there and and thirdly, you know, I think with the planes acquisition, we're going to really enhance our Market access and uh, especially out to the east which is really going to

Operator: Thank you. Your next question comes from the line of Patrick Kenny from National Bank Capital Markets. Please go ahead.

Thank you and your next question comes from the line of Robert <unk> from CIBC. Please go ahead.

Patrick Kenny: Thank you. Good morning, everyone. Maybe just on the CapEx budget here through 2026. Looking at the balance sheet, still in really good shape heading into the Plains acquisition. Just given the slippage in commodity prices and some near-term Marketing contributions, any thoughts on how much you'd be willing to flex your growth capital program over the near term if new opportunities arise? On the flip side, any thoughts around building any further cushion over the near term just until commodity prices normalize?

Hey, good morning, everyone I wanted to follow up on <unk> first question, just the practical implications on the timing on the plains transaction. So.

My question is what is the likelihood that the transaction closes in time for a carrier to go to market for the 26 contracting year on a more integrated basis.

A compliment. Um, you know the markets that we can serve already in the West and also locally, especially with our condo state system. Our, uh, you know, ISO octane business, you know, our propane access is going to be much stronger with the planes business. So again, that’s going to be another, um, you know, positive tailwind for our marketing business.

Okay, thanks everyone for the answers. I'll turn it back.

Yeah, thank you.

Okay.

Uh-huh.

Well that's a good question.

Thank you. And your next question comes from the line of Robert Cattleya from CIBC please. Go ahead.

At the end of the day, we are certainly.

The Bureau process as that review is proceeding as we would've expected.

Dean Setoguchi: Good morning, Pat. Thanks for the question. I'll turn that over to Eileen.

And just the Practical implications of the timing on the planes transaction. So,

This is a large acquisition so with any large acquisition. It takes time and that timing isn't always circle. So.

Eileen Marikar: Sure. Thanks, Pat. Just as a general comment, I'd say kind of reiterating what Dean said earlier, it's like the strength of our balance sheet and the low leverage has been a competitive advantage for us. We intend to maintain that advantage. It's because of this philosophy that we were able to pursue Plains this year, which, again, Dean touched on. When we plan our future capital allocation, whether it's growth capital, dividends, etc., we always assume a more normalized Marketing. We never plan for exceptional results. The lower contribution this year or a more muted contribution would not impact what we put out in terms of our leverage, which is still, once we close Plains within the first 12 months, to be still within our target range, that 2.5x to 3x, albeit at the higher end.

We believe that we're still on track too.

My question is, what is the likelihood that the transaction closes in time for a care to go to market for the 26 contracting year on a more integrated basis?

To get through that process in the first quarter at close.

It would be nice if we could have a close before contracting season, but that still remains to be seen that's obviously not 100% within our control.

Yeah, that'd be great for customers as well.

And that's it.

Bigger picture here just looking at.

<unk>.

Yes.

We don't know what the ultimate size of the pipeline button.

My question is given your view of based on growth which is.

Some of there are some pretty strong.

What.

Yeah.

What is possible in terms of expansion of comps in terms of the timeline and it is not possible without.

Well, uh, that's uh, that's a good question. Um, you know, at the end of the day, we are certainly, uh, you know, the, the bureau process is that reviews proceeding as we would have expected. Um, you know, this is a large acquisition. So with any large acquisition, it takes time and uh, that timing isn't always certain. So, you know, we've, we believe that we're still on track to uh, to, you know, get through that process in the first quarter and close. Um, it would be nice if we could have a closed before Contracting season, but, you know, that Still Remains to be seen. That's obviously not 100% within our control.

Yeah, that would be great for the customers as well.

Eileen Marikar: The only other thing maybe I'd add is that when we did the funding plan for Plains, it contemplated that we remain within those bands. We quickly deleverage really once we're through this growth capital so that we are keeping our options open for other opportunities, especially with the basin growth that we see. We absolutely are able to still continue to grow and leverage those options as they come along, opportunities.

and just

Our material gathering and processing expansion by Keira.

Bigger picture here, just looking at, um, caps and...

Yeah.

I Love. The question there wasn't just like two quarters ago, you guys were asking us how we're going to fill caps, they're asking us to expand it.

um, you know, we don't know the ultimate size of the pipeline, but, you know, my question is given your, your view of base and growth, which is

But I mean, hey, with the contracts that we signed the estimate caps by the end of decade is going to get start to get pretty full.

Um, similar to ours and pretty strong. What? Um,

It's very exciting and telco competitive our system is in the demand for that service.

But maybe ill turn that question over to Derek Good morning, Robert I think that's really are always part of the plan is to add.

You know what is possible in terms of an expansion of caps in terms of the timeline, and is that possible without, um, a material gathering and processing expansion by Kira?

Dean Setoguchi: Yeah. Pat, just to add to that, I mean, certainly the frac projects and KAPS Zone 4, I mean, that's already built into our internal forecasts. We still remain within our guidance range, or our goal post, of 2.5 to 3x debt to EBITDA. I also point out that the 2.5 to 3x where we like to be is more conservative than sort of the industry infrastructure peers. If we get to the higher end of that range, I don't think that's the end of the world because we're still in a very good range relative to our peers. Again, we always like the ability to pay it back down, restore flexibility, and it enables us to be more opportunistic.

Particularly pump station capacity as the volumes warrant that and Thats really what were doing so theres some of that coming along on zone four.

I love. I love the question. It wasn't just like two quarters ago. You guys were asking us how we're going to fill caps. They're asking us, "Oh, we're going to expand it."

We expect that will continue through the end of the decade. So we still have some runway there to producing very capital efficient expansions through additional pumping before without a step change in capital beyond that.

Okay and last one for me just on the on the bigger picture what are you seeing in terms of how the.

The basin is changing we've had some more producer consolidation recently, but we're also seeing.

Maybe a different approach towards LNG with the major projects office, putting another project on there. So just when you look at those things together, how is the customer interaction and maybe the growth outlook changes.

Patrick Kenny: Okay. I appreciate that. Dean, maybe just back on the 3.5 BCF a day of LNG projects being of national interest. Would you be able to help us just distill what opportunities, say, over and above filling your existing assets, you might be looking at from a brownfield or even a greenfield perspective just to take advantage of this long-overdue window in political support?

But, uh, I mean, hey, with the contracts that we've seen. Yes, I mean, caps by the end of the decade, is going to get start to get pretty full, uh, which is very exciting and and tells all competitive our system is and and the demand for that service. Um, but but maybe I'll turn that question over to, uh, to Jared. Yeah, good morning Robert. I think that's really been always part of the plan is to add, um, particularly Pump Station capacity as uh, the volumes warranted and, and that's really what we're doing. So, you know, there's some of that coming along with Zone 4, um, and we expect that'll continue out through the end of the decade. So, we, we still have some Runway there to, to do some very Capital efficient, expansions through additional pumping before, we'd have a step change in in capital beyond that.

Yes.

So.

I feel a lot more optimistic today than I have in a long long time.

It's encouraging to hear some positive comments come from our Prime Minister and some actions in the right direction.

Okay? And the last 1 for me, just on the, on the, on the bigger picture, Dean, what are you seeing in terms of, um, how the, the Basin is changing. We've had some uh, more producer consolidation recently, but we're also seeing, um, maybe a different approach towards LNG with the major projects office putting another project on there. So just when you look at those things together,

<unk>.

I think it's great for Canada, if we can continue to develop more LNG off the west coast.

How is the customer interaction and maybe the growth Outlook changing?

Dean Setoguchi: Yeah. No, I think it's tremendously exciting. First of all, a lot of it is that there's not enough gas gathering and processing capacity to process that gas. When you think about where the bulk of that growth is going to come from, it's that Montney fairway. The most economic parts of the fairway where we're located are going to get developed disproportionately. We see an opportunity to provide that integrated service right from the gas plants. We're going to look at debottlenecks, potential greenfield expansions up there, and we also consider a tuck-in acquisition that could also support our network up in the north and, again, provide that full integrated service to our customers to offer them the best economic netback for their product.

<unk>.

And certainly he will benefit from that because.

yeah, I mean, it's

uh,

We have critical infrastructure that helps enable that.

But that base and growth.

I think theres still needs to be some.

Some progress on key policies that would again.

Just give a.

Everyone have a lot of confidence that we can we can do this.

In a competitive manner.

When you think about so I think the basin is going to grow and I should also mention too. It's exciting that enbridge is finding ways to add more capacity on their system, we know that.

<unk> ex Trans mountain has the ability to also debottleneck too. So I think this bodes well for our industry and for Canada, which is great and help us boost our economy.

Think about consolidation.

The way I think about it is that.

Patrick Kenny: Okay, last one for me, just a housekeeping item. You touched on your confidence in the normalized marketing guidance range. Eileen, you mentioned this is based on, I guess, a return to a more normalized commodity price environment of, looks like $65 to 75 per barrel. Just wondering, as we look at the strip, having a hard time breaking through $60 here, or at least for the next couple of years, once the down. Confirm or walk us through what other positive margin tailwinds you could point to, whether it's butane feedstock costs or perhaps other products that you market that might help offset some of these existing headwinds for now and firm up that confidence in the $310 to 350 range for at least 2026 and 2027?

I I I feel a lot more optimistic today than than I have in a in a long, long time. And, you know, it's encouraging to hear some positive comments. Come from our, our prime minister and some actions in the right direction. Um, you know, I I think it's great for Canada if we can continue to develop more, uh, LG off the west coast and um, and certainly, hey, we'll benefit from that because, uh, you know, we we have critical infrastructure that helps enable that, um, that that basing growth. Um, you know, I think there still needs to be some still, some progress on key policies that would again just just give, uh, everyone a lot of confidence that um, that, you know, we can, we can do this in a, in a competitive manner. Um, you know, when you think about so I think, you know the Basin is going to

As an industry, we should be working together to create the most competitive.

Low cost.

And environmentally friendly energy to serve the world.

And some of the consolidations that we're seeing I think it's good because it creates more size and scale and efficiency to help accomplish that.

And for <unk> as a midstream service provider, we're doing the same thing and Thats. What planes is all about where we're consolidating and we're going to be more efficient we're going to provide a more competitive service.

Grow and, and I should also mention too. It's exciting. That Umbridge is finding ways to add more capacity on their system. You know, we know that, uh, you know, TMX Trans Mountain has ability to also, uh, debottlenecking together to create the most competitive, um,

And that's going to make our basin more competitive and that should help us export more products with the with additional market access that we're going to be getting in the future.

You know, low cost, environmentally friendly energy to serve the world.

It's a good thing overall.

And you know, with some of the consolidations that we're seeing, I think it's good because it creates more size and scale and efficiency to help accomplish that.

Okay, great. Thank you very much.

Dean Setoguchi: Yeah. It's changing. Well, you hit on one of the big ones. It's butane as an input into iso-octane and also in a complement to our blending business. We do look at butane being in an oversupply. Our market in Western Canada is oversupplied in butane, and it's forecast to be so. As we've talked about, as there's more development in our basin, all those developments are fairly rich in natural gas liquids. Ultimately, with all the frac expansions that are happening with ourselves and some of our peers, we expect that there's going to be additional butane, that we'll continue to see that market oversupplied. We expect that butane prices will be relatively soft relative to historic levels, and that will be a positive for our business. We've touched on it, I think, based on fundamentals worldwide with respect to the pull for, sorry, for propane.

Yes. Thanks for the question so have a good weekend.

Thank you and your next question comes from the line of Theresa Chen from Barclays. Please go ahead.

Good morning, just a quick follow up one for me.

On the marketing segment.

And octane premiums seem to be improving so far in fourth quarter 2025, despite what should be a seasonally soft period.

We're we're a consolidating and we're going to be more efficient. We're going to provide a more competitive service and that's going to make our Basin more competitive and that should help us export more products with the uh, with additional Market uh, access that we're going to be getting in future. So I think it's it's a good thing overall.

Okay, great. Thank you very much.

Yeah, thanks for the question. Have a good weekend.

Factors contributing to this dynamic in your view is that octane demand related alluding to some of the long term trends you mentioned earlier or have there been supply destruction disruptions in octane observed in the market.

Thank you. And your next question comes from the line of the rest of Chen from Barclays piece. Go ahead.

Hey, good morning, Theresa and you're very astute to be watching that market, but ill turn that over to Jamie to provide more color on yes.

Yes, so good morning, III, So as Dean said, yes, Youre Bang on Q4 premiums are actually trading above historical levels.

Our view is that it's really attributed to.

Dean Setoguchi: Ultimately, with the assets that we're inheriting with the Plains acquisition, we see some opportunities to create value for our customer and also our shareholders on the propane side. Those would be the two big ones, other than what we talked about, which is the strength in our view around our Bob Cracks and iso-octane premiums. Yeah, and ultimately, we'll provide an update like we usually do in the second quarter of next year.

<unk>.

Both the supply and the demand side on the supply side, we're seeing some significant refinery outages.

Good morning. Uh, just a quick follow-up 1 from me, um, on the marketing segment. Um, octane premium seem to be improving so far in fourth quarter, um, 2025 despite what should be a seasonal fully soft period. Um, what are some of the factors contributing to this dynamic in your view is that Arcane demand related alluding to you know some of the long-term trends you mentioned earlier or have there been Supply destruction disruptions and octane observed in the market.

Also some some closures of refineries specifically on the West Coast, which is an area, where one of our products in the Western U S and so on so.

Hey, good morning Teresa and you're very astute to be watching that market but you know, I'll turn that over to you. It's Jamie to provide more color on.

But also demand has been has been strong certainly are Bob cracks as well.

Yeah. So good morning, Teresa. So as being said yeah, you're you're bang on Q4. Um premiums are actually trading above historical levels. Um I I our view is that it's it's really attributed to

I am really have some tailwind over the last two.

Period of time.

Patrick Kenny: Okay, that's great color. I appreciate all the comments. Thanks, everybody.

It's interesting with respect to gasoline pricing and offerings are not necessarily always limited to North America.

Dean Setoguchi: Yeah, thanks a lot.

Operator: Thank you. There are no further questions at this time. I want to hand the call back to Mr. Dan Cuthbertson for any closing remarks.

What's going on in North America, but long term, we have a really.

Um um both the supply and the demand side on, on the supply side, we're seeing um, some significant Refinery outages. Um, also some some closures um of refineries specifically on the west coast which is an area where a lot of our products um in the western us is so old. So

Dean Setoguchi: Thank you all again for joining us today. Please feel free to reach out to our best relations team if you have any additional questions. Have a good weekend, everybody.

Strong view that both our bond cracks and ISO octane premiums octane premiums are going to be robust theyre going to continue to be above historic levels.

Operator: This concludes today's call. Thank you for participating. You may all disconnect.

Not to the levels that we would have seen in 2022 through 24 based on some very unique geopolitical events on the planet, but we.

We expect that the that the.

Strength in isooctane premiums will persist into 2026.

Thank you.

Thank you and your next question comes from the line of Vijay <unk> from PVH. Please go ahead.

Okay.

Hey, good morning, everyone.

I was hoping to maybe just start on the macro and just kind of what's going on right. Now in Q4, I'm wondering if you could talk to maybe some of the activity levels, you're seeing across the north and south in light of.

You know, but also demand is being has been strong. Um, certainly, um, our Bob cracks as well have have, um, really had some Tailwinds over the last, um, period of time. And, and, you know, it it it's interesting with respect to, uh, gasoline pricing and and octane's are are not necessarily always limited to North America and, and the, and the, what's going on in North America, but long term, we, we have a really, um, um, strong view that both our Bob cracks and ISO octane premiums octane, premiums are are going to be robust. They're going to continue to be above historic levels. Um, not to the levels that we would have seen in 2022, or through 24, based on some very unique geopolitical, um, events on the planet. But you know, we we expect that

the, that the the strength in in isolating premiums will persist into 2026

LNG, Canada, starting to ramp up that second train and eco prices.

Thank you.

Starting to improve.

Yeah.

Thank you. And your next question comes from the line of EJ Odell from TPH. Please go ahead.

Hey, Julien Thanks for the question.

From a big picture standpoint, I mean, most of the growth in the basin has been and will continue to happen up in the Montney and a lot of value is derived from the liquids. So.

Even though.

So up in that area.

So it's not really that sensitive to natural gas prices is probably more sensitive to crude oil prices.

Hey uh morning everyone. Um, I was hoping to maybe just start on the macro and just kind of what's going on right now. In Q4 wondering, if you could talk to maybe some of the activity levels, you're seeing across the North and South in light of, you know, LG Canada, starting to wrap up that second train and Echo prices, um, starting to improve.

And even at $60 <unk> for condensate roughly.

You multiply that by the the FX rates in Canadian dollar terms, its still a pretty good price, which is still a good price incentive.

Yeah, uh, morning AJ. And thanks for the question. I think from the a big picture standpoint, I mean most of the growth in the Basin has been and will continue to happen up in the money and a lot of value is derived from the the liquids. So

Four four.

you know, even though

Producers to continue to drill and grow.

I think up in that area too that there is.

Theres not as much infrastructure capacity and that's from gas plants and all the way through the.

That value chain.

And so whenever you have scarcity of supply.

The producers wanted to make sure they have.

A secure that in order to fill their growth plans in the future.

You know what we can say is that demand has been very high for the remaining capacity that we have so we expect to continue to add volumes and grow even in the price environment that we're in and obviously.

You know, so so they're up in that area. Um it's not really that uh sensitive to natural gas prices. It's probably more sensitive to crude oil prices and even that $60 WTI, you know for condensate roughly uh you know you multiply that by the uh, the FX rate, you know, and Canadian dollar terms is still a, a pretty good price which is still a good price incentive uh for for you know, producers to continue to drill and and grow

I think up in that area too, that there is, um, you know, there's there's not as much infrastructure capacity and and that's from gas plants and all the way through the the, uh,

Adding the second train at LNG, Canada, what's going to help but we're going to look beyond that and we think that theres going to be more LNG developed off the west coast, which is going to again create further demand for more processing capacity in and cap service in our downstream business.

So overall, we think that demand will remain strong in the south I think thats, where its a little bit more sensitive to natural gas prices in our volumes have been relatively steady, especially when you consider what April prices have been.

And I think that if we catch a little bit of a period with stronger gas prices I'm sure. The producers down there are probably hedging forward too with some of the curves that you can see and.

There's a lot of gas still in place down in the south.

Over time, we expect that to get drilled up and see some volume growth there as well if you want to add Jim yes. So the only thing I'd add is everything I agree with everything Dean on the north and the South I think we're seeing some really positive.

Tailwind there as a result, there is there was a bunch of consolidation in two three years ago.

Company, a period of time to understand and resorts, but they are inheriting and ultimately putting drilling programs together and what we've seen is those companies then really starting to get after.

Price environment that we're in and and obviously um, you know, adding the uh the second train at LNG Canada is going to help but, you know, we're going to look beyond that and we think that there's going to be more LG developed off the West Coast, which is going to again, create further demand for more processing capacity and and cap service and our Downstream business. So overall, uh, you know, we think that demand will remain strong and in, in the South I think that's where it's a little bit more sensitive to natural gas prices. In our volumes have been, you know, relatively steady, especially when you consider what Aiko prices have been. Um and you know, I think that if we catch a little bit of uh a period with stronger gas prices, I'm sure the producers down there are probably hedging forward too with some of the curves that you can see and uh you know there's a lot of gas still in place down in the South and and over time we expect that to get drilled up and and see some more volume growth there as well. Anything you want to add? Jamie? Yeah, so

What they purchased Q3 years ago and seen some very very good results as a result of applying their technology their competency frankly, one of the reasons why they would have bought those assets because they believe they can do bigger things with the land base and the prospects of those assets.

We are seeing some really positive results in our self as well.

Okay, Great and then maybe just one more kind of on the medium or longer term.

The only thing I'd add is um everything. I agree with everything being said on the North in the South. I think we're we're seeing some really positive, um, you know, Tailwind there as a result, there's there was a bunch of consolidation 2, 3 years ago and it and it takes a company. A period of time to understand the resource that they're inheriting and ultimately putting drilling programs together. And what we've seen is those companies then really starting to get after um you know what, what they purchased 2 3 years ago and and

We've seen a handful of refined products pipelines being announced in the U S. Poland from pad two.

And then going into some of those refinery closure markets that you talked about them too.

Slide five I'm, just curious as you guys kind of think.

About your isooctane business, how you anticipate either one or multiple of these projects impacting those margins are having an impact on that business.

Seen some very, very good results as a result of applying their technology. Their competency, frankly, 1 of the reasons why they would have bought those assets is because they believed they could do bigger things with the, the land base and the prospectivity of of those assets. So, we are seeing some really positive results in the South as well.

Yeah. That's a good question, yes, so I love. The fact that you guys are on top of our business because yes. There's two pipelines that are being proposed refined pipelines that are being proposed to serve.

Nevada, Arizona by primarily the California market and the California market has seen some refinery closures happening and Thats really drawn creating a poll for those refined products out of slightly over to Texas.

Okay, great. Um, and maybe just 1 more kind of on the medium or longer term, you know, we've seen a handful of refined products pipelines being announced in the US, you know, pulling from Pad 2. Um and then going into uh some of those Refinery closure markets that you talked about into, you know, pad 5. I'm just curious as you guys kind of think about your ISO octane business, how you anticipate either you know 1 or multiple of these projects, impacting those margins or having an impact on that business.

And even further to the east so those two projects, we think have a lot of.

Monomeric and we currently serve a bunch of the refineries that would have connectivity and we would expect to supply into the markets that they are being built into so we have relationships net net do you see that as a very positive development for our business on the isooctane crime.

We like the markets that are served.

Continental markets that arent served off the water because we're advantaged removing our railcars down south and so we can certainly save on the transportation cost. If we don't have to take it all the way to the U S. Gulf Coast and we can hit one of those in land.

Yeah, that's a good question. See, yeah. So I love the fact that you guys are on top of our business because yeah. There's 2 pipelines that are being proposed refined pipelines, that are being proposed to serve, you know, the sort of the Nevada, Arizona, but primarily the California market and the California Market is seeing some Refinery closures happening, and that's really drawing creating a poll for those refined products out of likely out of Texas and, and even further, uh, to the east. So those 2 projects, we think have a lot of

Refiners are places, where they blend and gasoline so we'd like the developments of.

What's happening with the closures.

Um, on a merit and we currently serve a bunch of the refineries that would have connectivity and we would expect to supply into the markets that they're being built into. So we have relationships net net. We see that as a very positive development for our business, on the iso up in front.

California of refiners and also the gasoline demand growth that we're seeing as Jamie discussed in Arizona and Nevada.

Lake City that area and all.

Also in the Denver area as well.

Okay.

Thank you very much for the detail I'll turn it back.

Thank you.

Thank you once again should you have a question. Please press star followed by the one on your telephone keypad and your next question comes from the line of Maurice Choy from RBC capital markets. Please go ahead.

Thank you and good morning, everyone.

Just wanted to think about the world beyond <unk>.

We we uh we like the markets that are served uh the the Continental markets that aren't served off the water because we're Advantage. We're moving our rail cars down south and so we can certainly save on the transportation cost if we don't have to take it all the way to the US Gulf Coast, and we can hit 1 of those Inland, um, you know, refiners are places where they blend gasoline. So we like the developments of, um, you know, what's happening with the closures on in California of refiners and also the the gasoline demand growth that that we're seeing is is Jamie discussed in Arizona, and Nevada. Um, Salt Lake City that area um, and also in the Denver area as well

Transaction.

And then more big picture about how you view.

Okay. Um, thank you very much for the detail. I'll turn it back.

Partnerships.

Thank you.

Can you talk to what's worked well.

What youll be looking for going to salvage.

Establishing a new partnership or Alternatively, maybe you don't see that many new partnerships being formed over the coming years.

Thank you. Once again, should you have a question, please press star followed by the 1 on your telephone keypad. Your next question comes from the line of Marius Choi from RBC Capital Markets. Please go ahead.

Yeah, good morning <unk>.

Yes, that's a really good question.

I think one thing that we've.

We have a reputation for is that we're a good partner.

We work well with others, we understand the need for a win win if we want to have.

Thank you, and good morning, everyone. Um, just want to think about the world beyond the Plains transaction and then more big picture about how you view Partnerships. Um, can you talk to what's worked well?

Successful partnership that sustainable.

When we look at our business in the long term I think that we really believe in the value of partnering with indigenous groups and recognizing that they have unique needs in <unk>.

What you'll be looking for, when installation establishing a new partnership, or alternatively, maybe you don't see that many new Partnerships being formed over the coming years.

and, uh, I think 1 thing that we've

Investment criteria, but.

When I think about future partnerships and if theres an opportunity that again would work for us and work for them.

That I think that we should definitely be exploring.

What we have a reputation for is that we're a good partner. We, uh, we work well with others, we understand the need for a win-win if we want to have a successful partnership that’s sustainable. Um, you know, when we look at our business in the long term.

Understood and if I could just finish off.

On the marketing side of the business I think you've touched on.

The turnaround you've touched on the strengthening.

Cracks as well as ice hockey and premiums.

In terms of the market dynamics that you highlighted today.

Marketing that you think will continue.

I think that I, you know, we really believe in in the value of partnering with the indigenous groups and you know, recognizing that, you know they have unique needs and and um you know, investment criteria. But you know, when I think about future Partnerships and if there's an opportunity that again would work for us and work for them uh it's something that I think that we should definitely be exploring.

Negatively into the new year or do you think most of that will unwind.

Yes, I'll turn that over to Geoff So sorry, Murray I understand your question is there any negative market dynamics that we expect to persist.

Carry on.

Yeah. So.

We did highlight the fact that we have seen a reduction in condensate imports and into Western Canada, and Thats something that we think.

<unk> is likely short lived based on the oil sands growth and the demand for diluent.

Understood. If I could just finish off on the marketing side of the business, I think you touched on the EF turnaround, you've touched on the strengthening of cracks, as well as I saw in premiums. Is there anything in terms of the market dynamics that you highlighted today for marketing that you think will continue negatively into the new year, or do you think most of that will unwind?

But other than that.

We're very bullish with respect to the demand for spec.

Propane in particular and excited to both of our export yield that we put in place with Alta gas and as gene said getting the assets from playing to access to markets in eastern.

Canada and the U S. So yes.

Yes no.

We are.

Don't see any major headwinds on the commodities that we touch for our marketing business going forward.

I would just say, though that.

I think everything is all relative and if you compare to 2023 and 2024 those were outsized years.

We delivered 480, <unk> hundred $85 million in those years.

So we certainly don't want anyone to think that that's the norm.

But I think we have a business that there will be years, where we have outsized performance.

Yeah, I'll turn that over to. Yeah. So sorry, Maurice to understand your question. Is there any negative market dynamics that we expect to persist as like to carry on? Yeah, yeah. So, um, you know, I we we did highlight the fact that we've seen a reduction in in constant Imports and into western Canada. And, and that's something that we think um, is is is likely short-lived based on the oil sands growth and the demand for Delhi went. Um, but uh, other than that, you know, we're we're we're very bullish with respect to the the demand for spec um propane in particular and and excited about the export deal that we put in place with Alta gas and as Dean said, getting the assets from playing to access to markets in in uh Eastern um Canada and the US. So um yeah no I I we we we uh um, you know, don't see any major headwinds uh on the Commodities that we touch um for our marketing business.

And I just wanted to make sure that everyone understands that we have the discipline. When we have those oxides years, we take those extra marketing dollars and we paid down our debt.

That are afforded us that in our free cash flow afforded us the ability to to sanction or a capstone for our two frac projects and also pursue planes the planes Canadian NGL business, which really is a big game changer for our company. So I think we have to think about marketing in our business.

Business. Um, going forward? Yeah, I just say though that, you know, I think everything is all relative and you know, if you compare it to 2023 and 2024 those were out outside years. I mean, you know, we we delivered 480 400 85 million in those years and uh we certainly don't want anyone to to think that that's the norm. But you know, I think we have a business that, you know, there

More holistic macro manner and what it does for overall business, then and it's been a very successful model from from day, one and I think it will be in the future as well.

That makes sense. Thank you very much.

Yes, thanks, very much I agree weekend.

Thank you and your next question comes from the line of Patrick Kenny from National Bank Capital markets. Please go ahead.

Thank you and good morning, everyone.

Maybe just on the Capex budget here through 2006.

Looking at the balance sheet still in really good shape heading into the plains acquisition.

There will be years where we we have outsized performance and I just want to make sure that everyone understands that we have the discipline when we have those outsides years. We we take those extra marketing dollars and we pay down our debt and that afforded us that in our free cash flow afforded us ability to to sanction or or cap zone for our 2 fractions. And also pursue planes, the planes Canadian NGL business, which really is a big game changer for our company. So I think we have to think about Marketing in our business in a, in a more holistic uh, macro Manner and and what it does for overall business. And and it's been a very successful model from from day 1 and and I think it will be in the future as well.

Just given the slippage in commodity prices and <unk>.

That makes sense. Thank you very much.

Some near term marketing contributions any thoughts on.

Yeah, thanks very much. Have a great weekend.

How much you'd be willing to flex your growth capital program.

Over the near term.

New opportunities arise.

Thank you. Your next question comes from the line of Patrick Kenny from National Bank Capital Markets. Please go ahead.

Or on the flip side.

Any thoughts around building any further cushion.

Over the near term just until commodity prices normalize.

Good morning, Pat.

Thanks for the question I'll turn it over to Ali sure. Thanks, Pat.

Thank you. Good morning everyone. Um, maybe just on the capex budget here, uh, through 26 and looking at the balance sheet still in really good shape heading into the plans acquisition, but, um, you know, just giving the slippage and commodity prices and

A general comment I'd say kind of reiterating what Jim said earlier.

Both of our balance sheet and our loan leverage has been a competitive advantage for us and we.

Some near-term marketing contributions. Any thoughts on how much you'd be willing to flex? Your Growth Capital program?

Over the near term, if new opportunities arise.

Intend to maintain that advantage. So it's because of this philosophy that we were able to pursue a plane.

Or on the flip side. Um, any thoughts around building any further cushion?

Again being touched on.

Over the near term, just until commodity prices normalize.

And when we plan our future capital allocation, whether it's growth capital our dividends et cetera.

Always assume a more normalized marketing we never plan for exceptional result.

So the lower contribution this year or more muted contribution would not impact what we put out in terms of our leverage which is still once we closed claims within the first 12 months to be still within our target range that two five to three times, albeit at the higher end and the only other thing I'd maybe add.

That is that when we did the funding plan for claims it contemplated that we remain within the bands and then we quickly deleverage.

They buy once once we're through this growth capital. So that we are keeping our options open for other opportunities, especially with the base and growth that we see.

We absolutely are able to still continue to grow and leverage those options as they come along.

Kennedy.

Pat just to just to add to that I mean, certainly the fracs the frac projects and capstone floor, I mean, thats already built into our internal forecast.

We still remain within our.

Our guidance range, our our our goalpost of two five to three times debt to EBITDA.

And so.

I also point out that the two five to three times, where we like to be more conservative than than sort of the industry.

Capital or, you know, dividends Etc. Um, we always assume a more normalized marketing. We never plan for exceptional results. Um, so, you know, the the lower contribution this year or or, you know, a more muted contribution would not impact what we put out in terms of our leverage, which is still once we close planes. Within the first 12 months to be, you know, still within our target range that 2 and a half to 3 times albeit at at the higher end. And the only other thing, I maybe I'd add is that when we did the funding plan for planes, it contemplated that we, we remain within those bands, and then we quickly de-lever, um, you know, really buy once once we're through this growth Capital, so that we are keeping our options open for other opportunities. Especially with the base and growth that we see, um, we absolutely are able to still continue to grow and and, and leverage those options as they come along.

Infrastructure peers. So if we get to the higher end of that range I don't think thats the end of the world.

Because we're still in a very good range relative to our peers, but again, we always like the ability to pay it back down restore flexibility and enables us to be more opportunistic.

Opportunities. Yeah, and that just to just to add to that. I mean, certainly the, the frocks, the Frac projects and and capsule for. I mean, that's already built into our internal forecasts and we still remain within our, you know, our our guidance range or our, our got our goals of 2 and a half to 3 times that to Eva.

Okay, I appreciate that and.

But maybe just back on the.

Three five Bcf a day of LNG projects.

Being a natural national interest.

Would you be able to help us just distill what opportunities.

Over and above filling your existing assets.

Might be looking at from a brownfield or even a greenfield perspective.

And so in in, you know, I also point out that the 2 and a half to 3 times where we like to be, is more conservative than, than sort of the industry, uh, you know, infrastructure peers. So, you know, if we get to the higher end of that range, I don't think that's the end of the world. Um, you know, because we're still in a very good range, relative to our peers, but, you know, again, we we always like the ability to, to pay it back down, restore flexibility and, and enables us to be more opportunistic.

Just to take advantage of this.

Long overdue window and political support.

Okay, uh, appreciate that, and um.

Yeah no.

Think it's tremendously exciting and.

First of all.

But Dean, maybe just back on the uh you know, 3 and a half BCF a day of LNG projects um being of natural National interest.

A lot of it is is that there's not enough gas gathering and processing capacity to process that gas and when you think about where the bulk of that growth is going to come from if that montney fairway in the most economic parts of the fairway, where we're located is going to get developed.

Would you be able to help us just distill? What opportunities, you know, say over and above filling your existing assets, you might be looking at from a Brownfield or even a Greenfield perspective?

Just to, you know, take advantage of this, um, long overdue window in political support.

Disproportionately and so we see an opportunity to provide an integrated service right from the gas plants. So we're going to look at.

Deep bottlenecks, where I'll look at potential Greenfield expansions up there or would you also consider like a tuck in acquisition that could also support our network up in the north and again provide the full integrated service to our customers to offer them.

Yeah. No. I think it's tremendously exciting. And, uh, you know, first of all, uh, a lot of it is is that there's not enough, uh, gas Gathering and processing capacity to to process that gas. And, you know, when you think about where the bulk of that growth is going to come from. It's that Monty Fairway. And the most economic parts of the Fairway, where we're located is going to get developed.

Best economic netback for their product.

Okay and last one for me.

Just a housekeeping item you touched on your confidence in the.

The normalized marketing guidance range. I mean, you mentioned this is based on a I guess a return to a more normalized commodity price environment.

You know, uh, disproportionately, and um, so we see an opportunity to provide that integrated service right from the gas flats. So, you know, we're going to look at, you know, bottlenecks, we're going to look at potential greenfield expansions up there or, you know, we also consider, like, a tuck-in acquisition that could also support our network up in the north.

It looks like 65 to $75 per barrel. Just wondering you know as we look at the strip, having a hard time breaking through 60 here.

And and again provide that full Integrated Service to our customers to uh to offer them the the uh the best economic netback for the product.

For the next couple of years.

Most of them.

okay, and last 1 for me, um,

Confirm or walk us through what other positive margin tailwind. So you can point to whether it's butane feedstock costs or <unk>.

Just a housekeeping item, you touched on your confidence in the...

Perhaps other products that you market.

That might help offset some of these existing headwinds for now and for about that.

Confidence in the $3 10 to $3 50 range for at least 26 27.

You know, the normalized marketing, guidance, range and Eileen you mentioned. This is based on a, I guess a return to a more normalized commodity price. Environment of uh looks like 65 to 70 5, uh per barrel just wondering, you know as we look at the strip having a hard time breaking through 60 here and

Or at least for the next couple of years.

Plus the down.

Scott It's Jamie.

You hit on one of the big ones is butane as an input into isooctane and also in a complement to our through our blending business.

Confirm or walk us through what other positive margin tailwinds you could point to, whether it's butane feeds, cost incentives, or other factors.

We do look at.

Butane.

In an oversupplied market in Western Canada is oversupplied and butane and it's forecast to be so.

Perhaps other products that you market, um, that might help offset some of these existing headwinds for now and firm up that confidence in the $310 to $350 range for at least 2026 and 2027.

We've talked about as they.

There is more development in our basin.

All of those.

Developments have are fairly rich in natural gas liquids and ultimately with all the frac expansions that are happening with ourselves and some of our peers. We expect that theres going to be additional butane that will continue to have seatback market oversupplied. So we expect that butane prices will be relatively soft relative to historic levels.

And that will be a positive for our business.

We've talked with we've touched on it I think based on the fundamentals.

That is Jamie. Um, well, I hit you hit on 1 of the big ones is, is butane, um, as an input into ISO Octane and and also, in in a compliment to, uh, to our blending business. Um, you know, we we do look at, um, you know, butane, um, being in an oversight, our Market in western Canada, is oversupplied and butane and it's forecast to be. So as as we've talked about, as, you know, there there's more development in our base and you know, it's good. Good. All those

Worldwide with respect to the pulp for I'm, sorry per propane and ultimately with the assets that we're inheriting with the <unk> acquisition, we we see some opportunities too.

Create value for our customer and also our shareholders on not on the propane side. So those.

Those would be the two big ones other than what we talked about which is the strength in our view around our Bob cracks and ISO octane premiums.

Yeah, and ultimately we'll provide an update.

We usually do in May.

In the second quarter of next year.

Okay, No that's great color I appreciate all the comments thanks everybody.

Yeah, Thanks, a lot.

Thank you there are no further questions at this time I will now hand, the call back to Mr. Dan Paterson for any closing remarks.

Frac expansions that are happening with ourselves. And and some of our peers, we expect that there's going to be additional butane that, that will continue to have to see that market over Supply. So we, we expect that the same prices will be relatively soft relative to Historic levels and that will be a positive for, for our business. Um, you know, we've talked, we've touched on it, you know, I think, um, based on fundamentals, um, uh, worldwide with respect to the poll for be, uh, sorry for propane and ultimately with the assets that were inheriting with the planes acquisition, we, we see some opportunities to, um, you know, create value for our customer and also, our shareholders, on the, on, on the propane side. So, you know, those would be the 2, big ones. Other than what we talked about, which is the, the strength in our view, um, around our Bob cracks and and ISO octane premiums

Thank you all again for joining us today and please feel free to reach out to our Investor Relations team. If you have any additional questions over the weekend everybody.

Yeah, and ultimately we'll we'll provide an update. Uh like we usually do in the uh, you know, in in the second quarter of next year.

And this concludes today's call. Thank you for participating you may all disconnect.

Okay, no, that's a great color. I appreciate all the comments. Thanks, everybody.

Yeah, thanks a lot.

Thank you. There are no further questions at this time. I want to hand a call back to Mr. Dan, cut person for any closing. Remarks.

Thank you all again for joining us today. And please feel free to reach out to our Best Relations team if you have any additional questions. Have a good weekend, everybody.

And this concludes today's call, thank you for participating. You may all disconnect