Q2 2026 MPLX LP Earnings Call
Speaker #1: Welcome to the MPLX, second quarter 2026 earnings call. My name is Julie, and I will be your operator for today's call. At this time, all participants are on a listen-only mode.
Operator: Welcome to the MPLX Q2 2026 Earnings Call. My name is Julie, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Press star one on your touchtone phone to enter the queue. Please note that this conference is being recorded. I will now turn the call over to Bryan Worthington. Bryan, you may begin.
Speaker #1: Later, we will conduct a question-and-answer session. Press star 1 on your touchstone phone to enter the queue. Please note that this conference is being recorded.
Speaker #1: I will now turn the call over to Ryan Morthington. Ryan, you may begin.
Speaker #2: Welcome to MPLX's second quarter 2026 earnings conference call. The slides that accompany this call can be found on our website at mplx.com under the Investors tab.
Bryan Worthington: Welcome to MPLX's Q2 2026 earnings conference call. The slides that accompany this call can be found on our website at mplx.com under the Investors tab. Joining me on the call today are Maryann Mannen, President and CEO, Chris Hagedorn, CFO, and other members of the executive team. We invite you to read the safe harbor statements on slide two. We will be making forward-looking statements today. Actual results may differ. Factors that could cause actual results to differ are included there as well as in our filings with the SEC. I will turn the call over to Maryann.
Speaker #2: Joining me on the call today are Maryann Mannen, President and CEO; Chris Hagedorn, CFO; and other members of the executive team. We invite you to read the safe harbor statements on Slide 2.
Speaker #2: We will be making forward-looking statements today, actual results may differ. Factors that could cause actual results to differ are included there, as well as in our filings with the SEC.
Speaker #2: With that, I will turn the call over to Maryann.
Speaker #3: Thanks, Brian. Good morning, and thank you for joining our call. Our second quarter results reflect the consistent execution of our strategic priorities. MPLX delivered 1.8 billion dollars of adjusted EBITDA in the second quarter.
Maryann Mannen: Thanks, Bryan. Good morning, and thank you for joining our call. Our Q2 results reflect the consistent execution of our strategic priorities. MPLX delivered $1.8 billion of Adjusted EBITDA in Q2, a 5% increase versus the same period last year, more than overcoming the divestiture of the Rockies assets in late 2025. This enabled a return of over $1.1 billion to our unit holders. 2026 is also a year of execution. We continue to advance high-return projects across our integrated natural gas and NGL value chains. The sequencing of projects entering service gives us confidence in a meaningful increase in EBITDA in H2 2026 and next year.
Speaker #3: A 5% increase versus the same period last year, more than overcoming the divestiture of the Rockies assets in late 2025. This enabled the return of over 1.1 billion dollars to our unit holders.
Speaker #3: 2026 is also a year of execution. We continue to advance high-return projects across our integrated natural gas and NGL value chains. The sequencing of projects entering service gives us confidence in a meaningful increase in EBITDA in the second half of 2026 and next year.
Speaker #3: In the Delaware Basin, we place the Secretariat I processing plant into service in April. An exited the quarter at 86% utilization of our Delaware Basin processing system, demonstrating strong producer demand and operational excellence from our teams.
Maryann Mannen: In the Delaware Basin, we placed the Secretariat I processing plant into service in April and exited Q2 at 86% utilization of our Delaware Basin processing system, demonstrating strong producer demand and operational excellence from our teams. In August, the Harmon Creek III processing plant is beginning operations in line with our strategy to add processing capacity on a just-in-time basis. This increases our total processing capacity to 8.1 BCF per day and de-ethanization capacity to over 800,000 barrels per day. This plant, along with our associated gathering and compression expansions, extends our ability to meet producer needs in liquids-rich areas and supports long-term throughput growth. As we expand MPLX's core value chains, we are also focused on maximizing utilization of existing assets and optimizing operations.
Speaker #3: And in August, the Harmon Creek III processing plant is beginning operations in line with our strategy to add processing capacity on a just-in-time basis.
Speaker #3: This increases our total processing capacity to 8.1 billion cubic feet per day and de-ethanization capacity to over 800,000 barrels per day. This plant, along with our associated gathering and compression expansions, extends our ability to meet producer needs in liquids-rich areas and supports long-term throughput growth.
Speaker #3: As we expand MPLX's core value chains, we are also focused on maximizing utilization of existing assets and optimizing operations. In the Northeast, Marcellus Processing Utilization of 96% in the quarter, led to record volumes across our system, while strong production activity in the Utica supported processing utilization of 73%.
Maryann Mannen: In the Northeast, Marcellus processing utilization of 96% in the quarter led to record volumes across our system, while strong production activity in the Utica supported processing utilization of 73%. In the Permian, sour gas treating volumes exceeded 150 million cubic feet per day for the second consecutive quarter as we continue to optimize operations at our Titan treating facility. As throughputs increase across our gathering and processing assets and additional projects enter service in the H2 of the year, MPLX remains positioned to deliver mid-single-digit Adjusted EBITDA growth. Natural gas and NGL fundamentals remain robust, creating compelling opportunities to support growing global demand for US energy. When we allocate capital, we remain disciplined. There must be strong strategic fit, durable demand, and compelling returns.
Speaker #3: In the Permian, sour gas treating volumes exceeded 150 million cubic feet per day, for the second consecutive quarter, as we continue to optimize operations at our tightened treating facility.
Speaker #3: As throughputs increase across our gathering and processing assets, and additional projects enter service in the second half of the year, MPLX remains positioned to deliver mid-single-digit adjusted EBITDA growth.
Speaker #3: Natural gas and NGL fundamentals remain robust. Creating compelling opportunities to support growing global demand for U.S. energy. When we allocate capital, we remain disciplined.
Speaker #3: There must be strong strategic fit, durable demand, and compelling returns. MPLX's investing over 90% of its organic growth capital toward opportunities to meet growing natural gas and NGL infrastructure needs, leveraging our advantage value chains.
Maryann Mannen: MPLX is investing over 90% of its organic growth capital toward opportunities to meet growing natural gas and NGL infrastructure needs, leveraging our advantaged value chains. MPLX is increasing its 2026 capital spending outlook by $500 million to $2.9 billion. The increase primarily reflects the accelerated execution of our ongoing Gulf Coast fractionation project, pulling forward capital we previously expected to deploy in early 2027. In July, the Blackcomb Natural Gas Pipeline began commissioning activities. The JV partners continue to progress the pipeline as planned, with Blackcomb expected to achieve full commercial service in the Q4. Within our NGL value chain, the expansion of our Bengal pipeline to 300,000 barrels per day is also expected online in the Q4, providing critical takeaway capacity as in-basin NGL volumes grow.
Speaker #3: MPLX is increasing its 2026 capital spending outlook by $500 million to $2.9 billion. The increase primarily reflects the accelerated execution of our ongoing Gulf Coast fractionation project, pulling forward capital we previously expected to deploy in early 2027.
Speaker #3: In July, the Blackcomb natural gas pipeline began commissioning activities. The JV partners continue to progress the pipeline as planned, with Blackcomb expected to achieve full commercial service in the fourth quarter.
Speaker #3: Within our NGL value chain, the expansion of our Bangal pipeline to 300,000 barrels per day is also expected online in the fourth quarter, providing critical takeaway capacity as in-basin NGL volumes grow.
Speaker #3: In the Permian's Delaware Basin, which continues to attract strong producer interest, our teams are working to complete the expansion of our sour gas treating system to over 400 million cubic feet per day, the expansion of this strategic growth platform remains on track to enter service at the end of the fourth quarter and we anticipate volumes to ramp quickly.
Maryann Mannen: In the Permian's Delaware Basin, which continues to attract strong producer interest, our teams are working to complete the expansion of our sour gas treating system to over 400 million cubic feet per day. The expansion of this strategic growth platform remains on track to enter service at the end of the Q4, and we anticipate volumes to ramp quickly, supporting our run rate expectations for 2027. With multiple investments transitioning from construction to operation this year, we are on track to deliver mid-single-digit Adjusted EBITDA growth in 2026. While the year-over-year growth from 2025 to 2026 is more H2 weighted, it also positions MPLX for strong Adjusted EBITDA growth in 2027. Against the backdrop of geopolitical uncertainty, the strategic importance of US energy infrastructure remains clear. Domestic and global demand for secure, reliable energy continues to grow.
Speaker #3: Supporting our run rate expectations for 2027. With multiple investments transitioning from construction to operation this year, we are on track to deliver mid-single-digit adjusted EBITDA growth in 2026.
Speaker #3: While the year-over-year growth from 25 to 26 is more back half-weighted, it also positions MPLX for strong adjusted EBITDA growth in 2027. Against the backdrop of geopolitical uncertainty, the strategic importance of U.S.
Speaker #3: energy infrastructure remains clear. Domestic and global demand for secure, reliable energy continues to grow. Additionally, international customers are increasingly turning to the United States as they preferred supplier.
Maryann Mannen: Additionally, international customers are increasingly turning to the United States as a preferred supplier. MPLX is well-positioned to respond to our customers' requirements in this growing market. The construction of our Gulf Coast fractionation and export facilities continues to advance on schedule. We expect the first 150,000 barrel per day fractionator, the 400,000 barrel per day JV LPG export terminal, and the associated purity pipeline to be in service in 2028, followed by the second 150,000 barrel per day fractionation in 2029. Our confidence in the volumes and utilization of our assets reinforces our expectation for durable cash flows that will support MPLX's continued growth. This positions MPLX to continue reinvesting in the business while supporting the annual distribution increases to unitholders. Now, let me turn the call over to Chris to discuss our operational and financial results for the quarter.
Speaker #3: MPLX is well-positioned to respond to our customers' requirements in this growing market. The construction of our Gulf Coast fractionation and export facilities continues to advance on schedule.
Speaker #3: We expect the first 150,000 barrel per day fractionator, the 400,000 barrel per day JV LPG export terminal, and the associated purity pipeline to be in service in 2028, followed by the second 150,000 barrel per day fractionation in 2029.
Speaker #3: Our confidence in the volumes and utilization of our assets reinforces our expectation for durable cash flows, that will support MPLX's continued growth. This positions MPLX to continue reinvesting in the business while supporting the annual distribution increases to unit holders.
Speaker #3: Now, let me turn the call over to Chris to discuss our operational and financial results for the quarter.
Speaker #2: Thank you, Maryann. Slide 8 outlines the second quarter operational and financial performance highlights for our crude oil and products logistics segment. Segment adjusted EBITDA increased $23 million when compared to the second quarter of 2025.
Carl Kristopher Hagedorn: Thank you, Maryann. Slide 8 outlines the Q2 operational and financial performance highlights for our Crude Oil and Products Logistics segment. Segment Adjusted EBITDA increased $23 million when compared to Q2 2025. The increase was primarily driven by higher rates across the business units and increased butane blending, partially offset by lower crude pipeline throughputs from planned MPC turnaround activity and the seasonality of planned maintenance and project spending, resulting in higher operating expenses. MPLX has been strategically investing in butane blending systems throughout our terminal and pipeline network over the past few years. These investments allowed MPLX to blend additional butane volumes and take advantage of strong commodity prices in the quarter, generating over $20 million of additional benefit versus the prior year. Pipeline volumes increased 4% year-over-year, primarily due to Marathon's planned refining turnaround activities in the Mid-Continent region.
Speaker #2: The increase was primarily driven by higher rates across the business units and increased butane blending, partially offset by lower crude pipeline throughputs from planned MPC turnaround activity, and the seasonality of planned maintenance and project spending resulting in higher operating expenses.
Speaker #2: MPLX has been strategically investing in butane blending systems throughout our terminal and pipeline network over the past few years. These investments allowed MPLX to blend additional butane volumes and take advantage of strong commodity prices in the quarter, generating over 20 million dollars of additional benefit versus the prior year.
Speaker #2: Pipeline volumes increased 4% year-over-year, primarily due to Marathon's planned refinery turnaround activities in the Midcon region. Moving on to slide 9, segment adjusted EBITDA increased $62 million compared to the second quarter of 2025.
Carl Kristopher Hagedorn: Moving on to slide 9. Segment Adjusted EBITDA increased $62 million compared to Q2 2025. The increase was primarily driven by increased volumes, including growth from equity affiliates and acquisitions, partially offset by the divestiture of our Rockies assets in 2025. Excluding the impact of the Rockies divestiture, segment Adjusted EBITDA increased $99 million year-over-year. Gathering volumes were up 15% year-over-year, primarily from production growth in the Utica, Permian, and Marcellus basins. Processing volumes increased 5% year-over-year, primarily due to increased production in the Marcellus and Permian basins. Marcellus processing utilization was 96% for the quarter, demonstrating the need for incremental capacity as Harmon Creek III is beginning operations in August. Total fractionation volumes increased 8% year-over-year, primarily due to increased production in the Marcellus.
Speaker #2: The increase was primarily driven by increased volumes, including growth from equity affiliates and acquisitions, partially offset by the divestiture of our Rockies assets in 2025.
Speaker #2: Excluding the impact of the Rockies divestiture, segment adjusted EBITDA increased $99 million year-over-year. Gathering volumes were up 15% year-over-year, primarily from production growth in the Utica, Permian, and Marcellus basins.
Speaker #2: Processing volumes increased 5% year-over-year, primarily due to increased production in the Marcellus and Permian basins. Marcellus processing utilization was 96% for the quarter, demonstrating the need for incremental capacity is Harmon Creek 3 is beginning operations in August.
Speaker #2: Total fractionation volumes increased 8% year-over-year, primarily due to increased production in the Marcellus. With the startup of Secretariat 1 in April, volumes on the Bangal NGL pipeline increased over 200,000 barrels per day in the second quarter.
Carl Kristopher Hagedorn: With the startup of Secretariat I in April, volumes on the Bengal NGL pipeline increased over 200,000 barrels per day in Q2, illustrating the strategic value of our integrated wellhead-to-water strategy. Sour gas treating volumes in Q2 exceeded 150 million cubic feet per day as we continue to optimize operations at our Titan treating facility and expand its capacity to handle over 400 million cubic feet per day by the end of Q4. We are progressing construction of a natural gas pipeline connection to allow sweet gas from our Titan facility to feed into the Secretariat I processing plant. This highlights the value of our recently acquired Delaware Basin system. Beyond an increasing rig count in the US, MPLX is strategically positioned to support additional drilling activity by producer customers.
Speaker #2: Illustrating the strategic value of our integrated, well-head-to-water strategy. Sour gas treating volumes in the second quarter exceeded 150 million cubic feet per day, as we continue to optimize operations at our Titan treating facility and expand its capacity to handle over 400 million cubic feet per day by the end of the fourth quarter.
Speaker #2: We are progressing construction of a natural gas pipeline connection to allow sweet gas from our Titan facility to feed into the Secretariat 1 processing plant.
Speaker #2: This highlights the value of our recently acquired Delaware Basin system. Beyond an increasing rig count in the U.S., MPLX is strategically positioned to support additional drilling activity by producer customers.
Speaker #2: In the Permian Basin, undeveloped acreage in Lee and Eddy counties in New Mexico was recently released by current producer customers. Roughly 40% of this acreage has volumes dedicated to our sour gas treating system, highlighting the geographic advantage of the Titan complex within the Delaware Basin—excuse me.
Carl Kristopher Hagedorn: In the Permian Basin, undeveloped acreage in Lea and Eddy counties in New Mexico was recently leased by current producer customers. Roughly 40% of this acreage has volumes dedicated to our sour gas treating system, highlighting the geographic advantage of the Titan complex with the Delaware Basin. Excuse me. Additionally, the state of Ohio recently awarded leases for undeveloped acreage in Belmont County. Nearly half of this land is also dedicated to MPLX, and we anticipate additional production in the wet gas window of the Utica will add to higher utilization of our gathering and processing assets in the region with limited capital outlay. Furthermore, growing production from the Utica has supported recent investments and expansions of MPLX pipeline and Ohio River terminals to serve increasing regional demand. This positions MPLX to continue reinvesting in the business while supporting annual distribution increases to unitholders.
Speaker #2: Additionally, the state of Ohio recently awarded leases for undeveloped acreage in Belmont County; nearly half of this land is also dedicated to MPLX. We anticipate additional production in the wet gas window of the Utica will add to higher utilization of our gathering and processing assets in the region, with limited capital outlay.
Speaker #2: Furthermore, growing production from the Utica has supported recent investments and expansions of MPLX pipeline in Ohio River terminals. To serve increasing regional demand. This positions MPLX to continue reinvesting in the business while supporting annual distribution increases to unit holders.
Speaker #2: Now, let me hand it back to Maryann for some concluding thoughts.
Carl Kristopher Hagedorn: Now, let me hand it back to Maryann for some concluding thoughts.
Speaker #3: Thanks, Chris. Our base business is generating steady and durable growth. And the strategy we have executed over the last several years has positioned MPLX to continue delivering strong results.
Maryann Mannen: Thanks, Chris. Our base business is generating steady and durable growth, the strategy we have executed over the last several years has positioned MPLX to continue delivering strong results. Through disciplined capital deployment and optimization of our integrated value chains, we have grown Adjusted EBITDA, Distributable Cash Flow, and maintained a robust return profile. We are executing our long-term strategy with consistency and discipline, operate safely and reliably, grow through high return investments, optimize our integrated value chains, and maintain a strong financial foundation. This track record of execution has enabled us to increase our quarterly distribution by 12.5% in each of the last two years. We anticipate growing our distribution at this rate again in 2026 and in 2027. We expect to continue growing the distribution supported by durable cash flows, a strong balance sheet, and visible growth.
Speaker #3: Through disciplined capital deployment and optimization of our integrated value chains we have grown adjusted EBITDA distributable cash flow, and maintained a robust return profile.
Speaker #3: We are executing our long-term strategy with consistency and discipline. Operate safely and reliably. Grow through high return investments. Optimize our integrated value chains and maintain a strong financial foundation.
Speaker #3: This track record of execution has enabled us to increase our quarterly distribution by 12.5% in each of the last two years. We anticipate growing our distribution at this rate again in 2026 and in 2027.
Speaker #3: We expect to continue growing the distribution supported by durable cash flows a strong balance sheet and visible growth. While we are delivering our strategic organic growth priorities, we will continue to valuate inorganic opportunities as they arise to further expand our strategic value chains and grow cash flows.
Maryann Mannen: While we are delivering our strategic organic growth priorities, we will continue to evaluate inorganic opportunities as they arise to further expand our strategic value chains and grow cash flows. Underpinned by the optimization of our value chains and throughput ramp across new assets placed into service such as Secretariat I, Harmon Creek III, and our sour gas treating operations, MPLX remains on track to deliver sequential growth throughout the year, culminating in mid-single-digit Adjusted EBITDA growth in 2026. Now let me turn the call over to Bryan.
Speaker #3: Underpinned by the optimization of our value chains and throughput ramp across new assets placed into service, such as Secretariat 1, Harmon Creek 3, and our sour gas treating operations, MPLX remains on track to deliver sequential growth throughout the year, culminating in mid-single-digit adjusted EBITDA growth in 2026.
Speaker #3: Now, let me turn the call over to Brian.
Speaker #4: Thanks, Maryann. As we open the call for your questions, as a courtesy to all participants, we ask that you limit yourself to one question and a follow-up.
Carl Kristopher Hagedorn: Thanks, Maryann. As we open the call for your questions, as a courtesy to all participants, we ask that you limit yourself to one question and a follow-up. If time permits, we will re-prompt for additional questions. We will now open the call to questions.
Speaker #4: If time permits, we will reprompt for additional questions. We will now open the call to questions.
Speaker #1: Thank you. We will now begin the question and answer session. If you have a question, please press star then 1 on your touch-tone phone.
Operator: Thank you. We will now begin the question and answer session. If you have a question, please press star then one on your touch-tone phone. If you wish to be removed from the queue, please press star then two. If you are using a speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press star then one on your touch-tone phone. Our first question comes from John Mackay with Goldman Sachs. Your line is open.
Speaker #1: If you wish to be removed from the queue, please press star then 2. If you are using a speakerphone, you may need to pick up the handset first before pressing the numbers.
Speaker #1: Once again, if you have a question, please press star then 1 on your touch-tone phone. Our first question comes from John Kai with Goldman Sachs.
Speaker #1: Your line is open.
Speaker #5: Hey, team. Good morning. Thank you for the time. I wanted to talk about the growth cadence for the year. I appreciate the color on the project ramp for second half.
John Mackay: Hey, team. Good morning. Thank you for the time. I wanted to talk about the growth cadence for the year. I appreciate the color on the project ramp for H2, and the comments around mid-single-digit EBITDA growth for the year. I think your original comments for the year had been a little higher relative to the 2025 growth rate. I was just wondering if you can talk through some of the puts and takes for the year overall and how to maybe bridge us to our exit rate into Q4 of this year.
Speaker #5: And the comments around mid-single-digit EBITDA growth for the year—I think your original comments for the year had been a little higher, relative to the '25 growth rate.
Speaker #5: So, I was just wondering if you can kind of talk through some of the puts and takes for the year overall, and how to maybe bridge us to our exit rate into the fourth quarter of this year.
Speaker #3: And then bangle at 250. And that'll go to 300 by the end of the year. Third quarter, Harmon Creek 3, as I mentioned in that came online here just in the beginning of August.
Maryann Mannen: Bengal at 250, and that'll go to 300 by the end of the year. Q3, Harmon Creek III, as I mentioned, and that came online here just in the beginning of August. We'll be ramping through that through Q3 and into Q4. Bay Runner as well. That's the 2.6 BCF natural gas supply to LNG facilities in Brownsville. Q4, we've got Blackcomb. I mentioned that in my remarks, as you have already talked about. The ramping of the Titan facility, that's Delaware Basin sour gas, back into Q3 and then again in Q4 as we reach the over 400 of processing capacity. Year-on-year, again, just reiterating, John, that does give us confidence that 2026 growth will exceed that of 2025.
Speaker #3: So we'll be ramping through that through the third quarter and into the fourth quarter and then Bay Runner as well. That's the 2.6 BCF natural gas supply to LNG facilities in Brownsville.
Speaker #3: And then fourth quarter, we've got Blackcomb. I mentioned that in my remarks as you have already talked about. And then the ramping of the Titan facility.
Speaker #3: That's Delaware Basin, sour gas. Back into the third quarter and then again in the fourth quarter as we reach the over 400 processing capacity.
Speaker #3: So, year on year—again, just reiterating, John—that does give us confidence that '26 growth will exceed that of '25. And, frankly, as we think about the sequence, third quarter should be stronger than the second quarter, and fourth should be stronger than the third as well.
Maryann Mannen: Frankly, as we think about the sequence, Q3 should be stronger than Q2, and Q4 should be stronger than Q3 as well. Certainly not trying to convey anything different than we have before. If for some reason we have, apologize for that, we continue to see that growth as we have outlined. Let me pause and see if I've answered your question, John.
Speaker #3: So certainly not trying to convey anything different than we have before. So if for some reason we have apologize for that. But we continue to see that growth as we have outlined.
Speaker #3: Let me pause and see if I've answered your question, John.
Speaker #5: No, thanks for that, Maryann. I appreciate all the walkthrough there. My second question is just on the new details on the frac timing and the capex pull-forward.
John Mackay: No, thanks for that, Maryann. I appreciate all the walking through there. My second question is just on the new details on the frack timing and the CapEx pull forward. You guys talked about this a little bit, maybe you can just walk through some of the new timing expectations for the fracks, and how to think about them coming online relative to the export dock and how that's changed from prior. Thanks.
Speaker #5: You guys talked about this a little bit, but maybe you can just walk through some of the new timing expectations for the fracs and how to think about them coming online relative to the export dock, and kind of how that's changed from prior.
Speaker #5: Thanks.
Speaker #3: Yeah, certainly. So, first and foremost, the project remains on budget. All we're doing here is pulling early spend that we had planned or expected, excuse me, in 2027 into the back half of 2026.
Maryann Mannen: Yeah, certainly. First and foremost, project remains on budget. All we're doing here is pulling early spend that we had initiated or expected, excuse me, in 2027 into the back half of 2026. This gives us an even higher degree of confidence in the completion on time, obviously gives us the potential for early, certainly gives us confidence in on-time completion of the frack and the dock. We would expect both the frack and the dock to come online at the same time, certainly we would not have the frack come online ahead of the dock. We have good confidence in the timing of this project, and we are confident in the fact that all of our assets, as we've been communicating, are full, and we're pleased around that.
Speaker #3: This gives us even higher degree of confidence in the completion on time, and obviously gives us the potential for early, but certainly gives us confidence in on-time completion of the frac and the dock.
Speaker #3: We would expect both the frac and the dock to come online at the same time, but certainly we would not have the frac come online ahead of the dock.
Speaker #3: So, we have good confidence in the timing of this project, and we are confident in the fact that all of our assets, as we've been communicating, are full.
Speaker #3: And we're pleased around that. Sean was just there a few weeks ago, visiting the site. And so I thought I might let Sean give you a little bit of color on how that project is progressing through a construction lens.
Maryann Mannen: Shawn was just there a few weeks ago visiting the site, I thought I might let Shawn give you a little bit of color on how that project is progressing through a construction lens. Thanks, Shawn.
Speaker #3: Thanks, John.
Speaker #4: Hey, John. This is Sean. As Maryann said, I happen to have a chance to be there just a few weeks ago. And as I stood there and saw the 60,000 barrel spheres being constructed, and the 600,000 refrigerated tanks for the terminal being constructed, it really just reinforced exactly what Maryann said.
Shawn Lyon: Hey, John, this is Shawn. As Maryann said, I happened to have a chance to be there just a few weeks ago. As I stood there and saw the 60,000 barrel spheres being constructed and the 600,000 refrigerated tanks for the terminal being constructed, it really just reinforced exactly what Maryann said, the confidence that we'll be online in early 2028. In addition, I just want to say this, the level of safety that the entire team and the contractors are showing on the site is very visible. Really proud of the team to make sure that's first and foremost.
Speaker #4: The confidence that we'll be online in early 2028. In addition, I just want to say this: the level of safety that the entire team and the contractors are showing on the site is very visible.
Speaker #4: Really proud of the team. To make sure that's first and foremost.
Speaker #5: I appreciate that detail. Thank you.
John Mackay: I appreciate that detail. Thank you.
Maryann Mannen: I don't know, John, if that answers your question. Sorry.
Speaker #3: That answers your question. Sorry.
Speaker #5: Yes, that was great. Thanks, Maryann. Thanks, Sean.
John Mackay: Yes, that was great. Thanks, Maryann. Thanks, Shawn.
Speaker #3: Oh, you're most welcome. Thank you.
Maryann Mannen: Oh, you're most welcome. Thank you.
Speaker #1: Thank you. The next question comes from Manav Gupta with UBS. Your line is open.
Operator: Thank you. The next question comes from Manav Gupta with UBS. Your line is open.
Speaker #6: Hi, good morning. I'm trying to get a little more details about the Titan. And how the overall Permian gas situation is moving ahead with these new pipes opening up.
Manav Gupta: Hi, good morning. I'm trying to get a little more details about the ramp and the completion at Titan and how the overall Permian gas situation is moving ahead with these new pipes opening up. If the Waha remains in the positive territory, you could see more NGLs come out of Permian, more gas come out of Permian. If you could that way highlight your leverage to entire Permian gas situation, especially the Titan project.
Speaker #6: If the Waha remains in the positive territory, you could see more NGLs come out of Permian, more gas come out of Permian. And if you could that way highlight your leverage to the entire Permian gas situation, especially the Titan project.
Speaker #3: Certainly. Thanks for the question. So let me start and then I'll pass to Greg to give you a little more color on the actual progress and details around Titan.
Maryann Mannen: Certainly. Thanks for the question. Let me start, then I'll pass to Greg to give you a little more color on the actual progress and details around Titan, then Dave can give you some further insights into how we're seeing egress out of the Permian. Hopefully, you've heard we continue to operate the Delaware Basin sour gas processing system well a second consecutive quarter where we exceeded 150 a day. We're continuing to optimize around that, obviously looking for cost reductions. This was always intended to be an important platform for us for growth, we continue to see that. As you know, you may have heard we had multiple producer customers expressing interest in the platform, that obviously opens up opportunities for us to increase utilization. Pleased on current performance.
Speaker #3: And then Dave can give you some further insights into how we're seeing egress out of the Permian. Hopefully, you've heard we continue to operate the Delaware base and Sour Gas processing system well.
Speaker #3: This is the second consecutive quarter where we exceeded 150 a day, and we're continuing to optimize around that. Obviously, we're looking for cost reductions—this was always intended to be an important platform for us for growth.
Speaker #3: And we continue to see that. And as you know, you may have heard we had multiple producer customers expressing interest in the platform. And that obviously opens up opportunities for us to increase utilization.
Speaker #3: So, pleased with current performance. In the back half of the year, as I mentioned earlier, we'll see the escalation of those volumes. Let me pass it to Greg, and he can give you some additional color on how that's operating.
Maryann Mannen: H2, as I mentioned earlier, we'll see the escalation of those volumes. Let me pass it to Greg and he can give you some additional color on how that's operating.
Speaker #7: Thanks, Maryann. Manav, I'll just give a little bit of color around the Titan II expansion and associated projects, and how this ties in. As Maryann mentioned, we are continuing to operate at a volume level near the capacity we have.
Greg Floerke: Thanks, Maryann. Manav, I'll just give a little bit of color around the Titan II expansion and associated projects and how this ties in. As Maryann mentioned, we are continuing to operate at a volume level near the capacity we have. We're focused on improving reliability, obviously focused on safety and also on the operating costs and the efficiency that we operate the system with. In terms of Titan II, associated with Titan II and the actual amine treating capacity expansion, we're also building about 100 miles of pipeline, multiple compression station expansions to provide the hydraulic capacity to fill the plant. We're also building a pipeline from Titan down to our Secretariat plant to be able to deliver sweet gas, as Maryann mentioned earlier.
Speaker #7: And so we're focused on improving reliability, obviously focused on safety, and also on the operating costs and the efficiency with which we operate the system.
Speaker #7: In terms of Titan 2, associated with Titan 2 and the actual Amine treating capacity expansion, we're also building about 100 miles of pipeline and multiple compression station expansions to provide the hydraulic capacity to fill the plant.
Speaker #7: And we're also building a pipeline from Titan down to our Secretariat plant to be able to deliver sweet gases, as Maryann mentioned earlier. So we've got a couple of different connections, including the line to Secretariat into our existing legacy system.
[Company Representative] (MPLX): We've got a couple of different connections, including the line to Secretariat into our existing legacy system. We truly are integrating the systems together, and one of the big benefits of this will be actually taking sweet gas to help fill our processing plants, which then in turn help to fill our Bengal NGL system. We're on schedule and in budget on those projects for Q4 delivery, including the new Titan expansion.
Speaker #7: So we truly are integrating the systems together. One of the big benefits of this will be actually taking sweet gas to help fill our processing plants, which, in turn, helps to fill our Banegas NGL system.
Speaker #7: We're on schedule and on budget for those projects slated for fourth quarter delivery, including the new Titan expansion.
[Company Representative] (MPLX): Manav, this is Dave, maybe I'll touch on your last question. Do we believe there's incremental takeaway capacity needed for the Permian from a nat gas perspective? The short answer is yes. We do believe that. As we all know, US natural gas demand continues to be very strong, underpinned by not only LNG, but also by data center needs. Specifically in the Permian, if you just look June, July, we've seen over 1 BCF a day of growth to nearly 25 BCF a day of gas in the Permian. That is forecasted to grow to 35 BCF a day by 2030. What we see from that forecast is that there is incremental takeaway capacity constraints anticipated in the future.
Speaker #4: So, Manav, this is Dave. Maybe I'll touch on your last question regarding whether we believe there's incremental takeaway capacity needed for the Permian from a nat gas perspective.
Speaker #4: The short answer is yes, we do believe that. As we all know, U.S. natural gas demand continues to be very strong, underpinned by not only LNG but also by data center needs.
Speaker #4: So specifically in the Permian, if you just look June to July, we've seen over one BCF a day of growth to nearly 25 BCF a day of gas in the Permian.
Speaker #4: And that is forecasted to grow to 35 Bcf a day by 2030. So, what we see from that forecast is that there are incremental takeaway capacity constraints anticipated in the future.
Speaker #4: As you know, we've been very active in numerous long-haul pipelines, from Whistler to Matterhorn to the Blackcomb and Eiger, long-haul pipes out of the Permian, and that's providing over 11 Bcf a day of takeaway capacity.
[Company Representative] (MPLX): As you know, we've been very active in numerous long-haul pipelines, from Whistler to Matterhorn to the Blackcomb and Eiger long haul pipes out of Permian. That's providing over 11 BCF a day takeaway capacity. Even with that, and with Blackcomb and Eiger coming online, Eiger later this year, Q4 this year, and Blackcomb, H2 2028, we still believe incremental takeaway capacity is needed. I think as we look forward, you'll continue to see us evaluate and participate, and deploy capital in incremental industry solutions to provide that long-haul takeaway capacity out of the Permian to the US Gulf Coast. Hopefully more to come.
Speaker #4: So even with that, and with Blackcomb and Iger coming online, Iger later this year fourth quarter this year and Blackcomb second half of 2028, we still believe incremental takeaway capacity is needed.
Speaker #4: So I think as we look forward, you'll continue to see us evaluate, participate, and deploy capital in incremental industry solutions to provide that long-haul takeaway capacity out of the Permian to the US Gulf Coast.
Speaker #4: So hopefully more to come.
Speaker #3: Hope that addresses your question, Manav.
Maryann Mannen: Hope that addresses your question, Manav.
Speaker #6: Absolutely. And a quick update for both the Iraner pipeline and the Beraner twin pipeline, if there is any update on those two projects. Thank you.
Manav Gupta: Absolutely. A quick update of both Bay Runner Pipeline and Bay Runner Twin Pipeline, if there is any update over those two projects. Thank you.
Speaker #3: Manav, the first part of your message cut out. Could you ask the question again? We heard the back half, but would you be able to repeat it?
Maryann Mannen: Manav, the first part of your message cut out. Could you ask the question again? We heard the back half, but would you be able to repeat it?
Manav Gupta: The Bay Runner Pipeline and the Bay Runner Twin Pipeline, if there is an update on those two projects.
Speaker #6: The Beraner Pipeline and the Beraner Twin Pipeline—if there is an update on those two projects.
Speaker #3: Sure.
Maryann Mannen: Sure.
Speaker #4: Yeah, Manav, this Dave again. So as we recently announced, as actually both these projects are supporting next decade to announce their first three trains and their subsequent trains, we along with our partners have been executing our projects to supply just-in-time capital to support when those are coming online to support the gas to those.
[Company Representative] (MPLX): Manav, this is Dave again. As we recently announced, actually both these projects are supporting our NextDecade LNG facility as they continue to announce their first 3 trains and their subsequent trains. We, along with our partners, have been executing our projects to supply just-in-time capital to support when those are coming online to support the gas to those. Bay Runner, and then now recently announced Bay Runner 2, which is the conversion from Rio Bravo. As we do in all our projects, kind of what Shawn touched on earlier, we're always looking at ways to be the most capital efficient and schedule efficient as possible.
Speaker #4: So Beraner and then now recently announced Beraner 2, which is the conversion from real Bravo and as we do in all our projects, kind of what Sean touched on earlier, we're always looking at ways to be the most capital efficient and schedule efficient as possible so that conversion from real Bravo to Beraner twin allows us to run it in the same in the same area and just be more effective and more efficient and we'll bring that online just in time as we did with Beraner to support next decade LNG expansion capacity.
[Company Representative] (MPLX): That conversion from Rio Bravo to Bay Runner Twin allows us to run it in the same area and just be more effective and more efficient, and we'll bring that online just in time as we did with Bay Runner to support NextDecade LNG expansion capacity.
Speaker #6: Thank you so much.
Manav Gupta: Thank you so much.
Speaker #3: You're most welcome.
Maryann Mannen: You're most welcome.
Speaker #5: Thank you. The next question comes from Jeremy Tenet, with JP Morgan. Your line is open.
Operator: Thank you. The next question comes from Jeremy Tonet with J.P. Morgan. Your line is open.
Speaker #3: Good morning. This is Francina on for Jeremy. Thank you so much for taking questions this morning. I just wanted to dig a bit deeper on the inorganic opportunity set that you kind of finished off the prepared remarks with.
[Analyst] (J.P. Morgan): Good morning. This is Francina on for Jeremy. Thank you so much for taking questions this morning. I just wanted to dig a bit deeper on the inorganic opportunity set that you finished off the prepared remarks with. Can you describe the opportunity sets that you have at hand? In terms of the strategy itself, would you characterize that more as bolt-ons or a kind of renewed strategy for MPLX via M&A? Thank you.
Speaker #3: Can you kind of describe the opportunity set that you have at hand and in terms of the strategy itself, would you characterize that more as bolt-ons or a kind of renewed strategy for MPLX via M&A?
Speaker #3: Thank you. Yo, certainly. And good morning. So when we think about inorganic opportunities, they need to fit our strategic intent. So you've heard us talk about well head to water, Dave just really shared with you our view on Permian, egress, our well head to water strategy, continues to be a very solid platform for us for growth and opportunities longer term, particularly when you look at demand pool I mentioned NAC gas and NGL and frankly the requirement for reliable secure energy and the pool on US.
Maryann Mannen: Certainly, and good morning. When we think about inorganic opportunities, they need to fit our strategic intent. You've heard us talk about wellhead-to-water. Dave just really shared with you our view on Permian egress. Our wellhead-to-water strategy continues to be a very solid platform for us for growth and opportunities longer term, particularly when you look at demand pool. I mentioned nat gas and NGL and, frankly, the requirement for reliable, secure energy and the pool on US. That's a place that we continue to lean in. Also, this needs to meet our hurdles, needs to be able to deliver our mid-teens return, and also have to ensure that we can deliver mid-single digit growth year on year. We're looking in those opportunities. Then also our JV partners, et cetera, as you've seen us take on transactions.
Speaker #3: So that's a place that we continue to lean in. Also, this needs to meet our hurdles, needs to be able to deliver our mid-teens returns, and also has to ensure that we can deliver mid-single digit growth year on year.
Speaker #3: So we're looking into those opportunities, and then also our JV partners, etc., as you've seen us take on transactions. Banagl would be a good example, as we increased our ownership assets.
Maryann Mannen: Bengal would be a good example as we increased our ownership assets we know and fit very deeply into our long-term strategy. Hopefully, that's a helpful response to you as we think about where we would be leaning in strategic fit, nat gas, NGL, our wellhead-to-water growth strategy. That's the places where we would be executing.
Speaker #3: We know and fit very deeply into our long-term strategy, so hopefully that's a helpful response to you as we think about where we would be leaning in strategic fit—NGL, nat gas, our wellhead-to-water growth strategy.
Speaker #3: That's the places where we would be executing.
Speaker #5: Thank you. That's very helpful. And then just looking a bit deeper on kind of the capital allocation priorities, given the pretty robust book of 2027 and the 12 and a half percent kind of distribution increase, remaining how do you see those priorities maybe changing longer term as we exit 2026 and into 2027?
[Analyst] (J.P. Morgan): Thank you. That's very helpful. Then just looking a bit deeper on the capital allocation priorities, given the pretty robust book of projects coming online in 2026 and 2027, and the 12.5% distribution increase remaining, how do you see those priorities maybe changing longer term as we exit 2026 and into 2027?
Speaker #4: Thank you, Francina. Yeah, what I would tell you is our capital allocation priorities are unchanged. So, when we think about the way we allocate capital, first and foremost, it's maintaining our assets and our current EBITDA level.
Carl Kristopher Hagedorn: Thank you, Francina. Yeah, what I would tell you is our capital allocation priorities are unchanged. When we think about the way we allocate capital, first and foremost, it's maintaining our assets and our current EBITDA level. Secondly, it goes to distribution growth, right? We've consistently communicated this 12.5% that we anticipate in both 2026 and 2027. Next, it's growth. That growth can come in the form of organic projects, some of the big ones that we've just went through, and in the continual evaluation of the inorganic opportunities that set in the basin. Hopefully that's responsive to your question, but really I would leave you with, our capital allocation priorities are unchanged.
Speaker #4: Secondly, it goes to the distribution growth, right? So we've consistently communicated this 12.5 that we anticipate in both 2026 and 2027.
Speaker #4: And next, it's growth. And that growth can come in the form of organic projects, some of the big ones that we've just gone through.
Speaker #4: And the continual evaluation of the inorganic opportunities that exist in the basin. So, hopefully that's responsive to your question, but really I would leave you with: our capital allocation priorities are unchanged.
Speaker #5: I'll leave it there. Thank you, team.
[Analyst] (J.P. Morgan): I'll leave it there. Thank you, team.
Speaker #3: You're welcome. Thank you.
Maryann Mannen: You're welcome. Thank you.
Speaker #5: Thank you. The last question comes from Burke Sansevero with Wolfe Research. Your line is open.
Operator: Thank you. The last question comes from Burke Sansiviero with Wolfe Research. Your line is open.
Speaker #4: Hi, good morning. Are you still targeting at least 1.3x coverage with the 2026 and 2027 distribution growth plans? And can this be met solely with organic growth, or is M&A required to get there?
Burke Sansiviero: Hi, good morning. Are you still targeting at least 1.3 times coverage with the 2026 and 2027 distribution growth plans? Can this be met solely with organic growth or is M&A required to get there?
Speaker #4: Yeah, thank you. What I would tell you is absolutely, we continue to target our 1.3 coverage ratio for both 2026 and 2027. And frankly, beyond.
Carl Kristopher Hagedorn: Yeah. Thank you. What I would tell you is absolutely, we continue to target our 1.3 coverage ratio for both 2026 and 2027, and frankly, beyond. What I would tell you is that from a capital perspective, we believe that our current organic plan gives us confidence. We have confidence in maintaining that 1.3 coverage. We've talked about it a few times now on this call. It's the second half growth that is going to give us confidence in 2026. Then frankly, entering 2027, we're going to have the platform to grow even more. Hopefully that's responsive. Maryann, you may have something else.
Speaker #4: What I would tell you is that from a capital perspective, we believe that our current organic plan gives us competent we have competence in maintaining that 1.3 coverage.
Speaker #4: We've talked about it a few times now on this call. It's the second half growth that is going to give us confidence in 126.
Speaker #4: And then frankly, entering 2027, we're going to have the platform to grow even more. So hopefully that's responsive. Maryann, you may have something else.
Speaker #3: Yeah, Burke, I think Chris did it well. Just maybe to reiterate, when we think about 2027, today as we sit here for all of the things as Chris mentioned, when you look at the projects coming online that we've put capital to work and the third quarter and the fourth quarter, some of them continue to ramp into 2027 as well.
Maryann Mannen: Yeah, Burke, I think Chris did it well. Just maybe to reiterate, when we think about 2027 today as we sit here for all of the things, as Chris mentioned, when you look at the projects coming online that we've put capital to work in Q3 and Q4, some of them continue to ramp into 2027 as well. We believe, as we sit here today, 2027 growth we have in hand, so to speak, with all of the projects. Now, that doesn't mean that we'll stop looking. We'll continue to evaluate inorganic opportunities. The goal of 1.3 coverage remains our objective in 2027. We're not looking for inorganic M&A to be able to meet that. We'll continue to look for it, but we don't need it to meet 2027. We hope that helps.
Speaker #3: We believe, as we sit here today, 2027 growth we have enhanced, so to speak, with all of the projects. Now, that doesn't mean we're going to stop looking.
Speaker #3: We'll continue to evaluate inorganic opportunities. But the goal of 1.3 coverage remains our objective in 2027. We're not looking for inorganic M&A to be able to meet that.
Speaker #3: We'll continue to look for it, but we don't need it to meet 2027. We hope that helps.
Speaker #4: Thanks for that. And historically, the companies stated that they like the current MPC, MPLX structure and argued against the idea of MPC rolling up MPLX at some point.
Burke Sansiviero: Thanks for that. Historically, the company's stated that they like the current MPC MPLX structure, and argued against the idea of MPC rolling up MPLX at some point. MPC has outperformed MPLX by a significant amount year to date, just with the favorable refining backdrop. It's been a pretty big relative move, so just wanted to check if the relative performance of the two complexes has had any impact on how you're thinking about the affiliate relationship, whether that relates to a roll-up, intercompany transactions or affiliate support. Thank you.
Speaker #4: But MPC is outperformed MPLX by a significant amount year to date, just with a favorable refining backdrop. It's been a pretty big relative move.
Speaker #4: So just wanted to check if the relative performance of the two complexes has had any impact on how you're thinking about the affiliate relationship, whether that relates to a roll-up, intercompany transactions, or affiliate support.
Speaker #4: Thank you.
Speaker #3: Yeah, no, thank you for the question. And of course, we are very glad to see that both MPC and MPLX continue to execute strategic priorities and optimize and execute in the manner in which we have shared we expect our performance.
Maryann Mannen: Yeah. No, thank you for the question. Of course, we are very glad to see that both MPC and MPLX continue to execute strategic priorities and optimize and execute in the manner in which we expect our performance. As it relates to the relationship between MPC and MPLX, we do not see any reason to change that relationship. Right now, there is a tremendous amount of value that's created as you look at the growth of MPLX year on year, and the ability for us to continue to grow that distribution for our unit holders. It provides sound cash flow back to MPC, and that relationship creates value, we think, for both the MPLX unit holder and the MPC shareholder. That is of importance. There is an important relationship and a strategic relationship between those two companies.
Speaker #3: As it relates to the relationship between MPC and MPLX, we do not see any reason to change that relationship right now. There is a tremendous amount of value that's created as you look at the growth of MPLX year on year and the ability for us to continue to grow that distribution for our unitholders.
Speaker #3: It provides sound cash flow back to MPC, and that relationship creates value, we think, for both the MPLX unitholder and the MPC shareholder.
Speaker #3: So that is of importance. There is an important relationship and a strategic relationship between those two companies. So we do not see a reason to change that at this time.
Maryann Mannen: No, we do not see a reason to change that at this time. I hope that helps.
Speaker #3: I hope that helps.
Speaker #4: Yeah, thanks for the time.
Burke Sansiviero: Yep. Thanks for the time.
Speaker #3: You're most welcome. Thank you.
Maryann Mannen: You're most welcome. Thank you.
Speaker #5: I'm sorry, no further questions? Yes.
Operator: I'm showing no further questions.
Carl Kristopher Hagedorn: Operator.
Operator: Yes.
Speaker #4: Okay. Well, thank you for your interest in MPLX. Should you have more questions, or want clarification on the topics discussed this morning, please contact us and our team will be available to take your calls.
Carl Kristopher Hagedorn: Okay. Well, thank you for your interest in MPLX. Should you have more questions or want clarification on the topics discussed this morning, please contact us and our team will be available to take your calls. Thank you for joining us today.
Speaker #4: Thank you for joining us today.
Operator: Thank you for your participation. Participants, you may disconnect at this time.
