Midstream (EQTNP) 1 Aug 232023 Q2 Earnings call transcript

Hello, and thank you for standing by. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Equitrans Midstream Second Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. [Operator Instructions]

to conference like Tetlow. to now would turn over the Nate I go Please ahead.

welcome Quarter XXX-XXXX call the for morning, the is this to Good and XXXXXXX. number phone Second XXX-XXXX. for days Corporation. for The replay evening. ID The available is Equitrans A XXXX (XXX) of be this (XXX) will replay XX beginning or Midstream Call Earnings conference

factors and in contain updated forward-looking factors Form XXXX, release statements expectations. events Please from actual the may future news XX, refer could to call that the Today's and by for differ these to risk ETRN's XX-K December for year materially today's to statements. related forward-looking cause results Form ended XX-Qs as and

refer Today's for call the to investor and disclosures news important most measure. may including presentation our release comparable contain morning's certain reconciliations Please such measures. this measures, regarding financial to GAAP non-GAAP financial

Karam, and and Kirk CEO; today the Systems, call and and open Diana and Chairman Planning the Officer; & Financial questions. prepared Chief Senior to President Charletta, Vice Oliver, Vice the we Macken, Engineering; remarks, Justin are President, On Treasurer. President Brenner, call Senior will Gas Officer; Operating Vice Tom Janice Chief After President

I'll over that, turn And with to Tom. it

the revenue morning, deferred Thanks, results of of results, in including $XX $XX reported Kirk Nate, net financial and everyone. and second million. good provide income $XXX a of million, we Today, quarter on details million XXXX few adjusted minutes. will EBITDA

on and enact Section a X. for together to permits operation includes the and for XXX, the from sides aisle, the both authorizations couple necessary way all has with of construction Responsibility legislation initial which It Act This leadership been in work of remarkable MVP. ratifies and XXXX Fiscal MVP. of We congressional approves months June saw a administration, the bipartisan

for claims and review all jurisdiction authorized June Columbia. jurisdiction of against On on for MVP Court of MVP for to the all XX, also initial the and operation of required legislation court resume. activities legislation any grants after agency U.S. construction FERC Importantly, construction to actions to Appeals divests District permits, exclusive necessary approvals the the received

After days stay the X an United project's of seeking On halting filed Fourth forward States on for the the the extent jurisdiction. federal of of the the and stays Fourth U.S. a only active July on issued XX, Court orders Court authorizations, Appeals with summary the Circuit emergency of again construction, ruling Circuit's Supreme to vacate construction. requesting application we

our the the filed with XX, motions and Supreme the cases underlying to vacated Circuit. Court previously stays, the dismiss On pending July Fourth are

ruling by Court We timely construction. and are at have the targeting the completion approximately we now project billion. are Despite once turns, focused and forward grateful construction cost for all total to be, the year-end still of and twists resumed a Supreme again, $X.X by on

turn will have I'll to now then operations brief financial for Diana some the and closing Diana? it and I'll discuss And comments. the results, update, Kirk

volumes and expect expect per takeaway volume morning, and new to capacity behind The to will optimistic transmission in-service, and we about After basin MVP are system. be the to we gathered everyone. quarter, the debottleneck we volume our growth. will see gathering that region serve for growth allows overall Thanks, Tom. flat and Good year. X.X In Bcf day, the roughly for second continue we

upstream the to well connectivity From assets making operations perspective, our to benefit. our only systems direct MVP, an provide positioned

West Ohio. from provide shippers their Virginia Our Pennsylvania, to gas Northern direct Southwestern assets to and flexibility with MVP

remain expect to volumes So given our MVP, connectivity basin gain disproportionate to flat. if share a to of even overall we volumes were

XX. days. Army OVCX, Valley the construction expect final certificate U.S. yesterday, FERC received coming on Corps required and federal we from Expansion commence from project, the to a Ohio Proceed On and July received in the authorization FERC Notice or transmission the received just XX its on to And of Connector the Engineers segment, June

capital OVCX and provides on to million through Connector Ohio. in that add Ohio is is Gulf first cubic pipeline, feet a day our Mid-Continent per access The $XXX capacity of will Valley Coast the in targeted million for project which about markets incremental the interconnects of Clarington, deliverability XXXX. XXX in-service half

was XXX,XXX water second segment, the in barrels. capacity water to our July, which service On facility storage storage placed total brings into

complete substantially expect the water We to of the system backbone mixed-use in be XXXX.

mixed-use executed fresh mixed-use a with producer an further provide reach to water agreement and system. the customer Additionally, recently both we the of service, extending

the this new million in We of in approximately will XXXX most outlay project with invest capital $XX XXXX. and

XX is new water the and that a mixed-use and that backed agreement the hub-and-spoke are is for volume system The is This looking evidence connectivity for optionality the strategy provides minimum by producers agreement for. years commitment.

update Rager in Moving occurred incident quarter that the year. on storage to well an on the Mountain last fourth

to progressing cause summer. investigation, be are completed the root this expected We with which is independent

to million approximately $XX second $X.X approximately post-incident of million CapEx $XX expense activities. know this related to what $X based of full incurred million the In we approximately the operating we million year, of quarter, expect incur for And expense related we on to incident. to today, and

more information continue We root analysis the and is diligently will to throughout work once the to complete. expect review cause provide

will say we brief update. today be in very we again, beyond what limited So this

week, we data and the items front, access Report the through is everyone encourage XXXX I'll at equitransmidstream.com. which our a on year-end information. ESG and published last few report full Sustainability to on our based highlight website Corporate XXXX Lastly,

XX in of justice efforts outreach a We environmental to of participants further conversion converted or basin We other our Methane expand beyond methane from XXXX. reductions through region. Appalachian for sites We adopted regulatory emission formally methane facilitate the to Initiative founding our the the high-bleed total project requirements. compressor member policy pneumatics low-bleed to since joined as industry compressor enhance air additional monitoring and pneumatics XX a

I'll now Kirk. turn the call over to

per of net E-Train attributable $XX quarter was diluted $XX share shareholders income $XXX deferred reported Today, million. million, adjusted common and we million Net second of to $X.XX. earnings Thanks, good income common and EBITDA revenue was Diana, and million morning, everyone. was $XX

free activities million. operating $XXX by cash provided million $XXX and cash net of of reported also flow We

attributable to was income E-Train by Net shareholders impacted several items. common

a by through provision derivative to which entitling instruments, other million First, This payments gain specific from to within and $XX reported in-service thresholds relates Hub XXXX. natural E-Train prices conditioned certain cash receive exceeding MVP's the post NYMEX, is income. contractual Henry on unrealized EQT, on running gas

E-Train related share $X.XX. Second, was to of million, incident. Rager second diluted After by for Mountain the and adjusted to operating adjusted shareholders mentioned was quarter common these $X.X expenses previously $XX attributable adjusting per the net common earnings income storage items, million

equity revenue is which restart with June associated second relating the Additionally, quarter quarter of forward income XXXX. Operating AFUDC of we MVP million, $XX of second for in reported the construction primarily the to was XXXX of from same the volumes, was lower compared gathered increased last the revenue. lower offset decrease quarter water year of driven primarily of million. service impact by by to $XX was partially The

was XXXX which Fiscal expenses quarter performance higher XXXX. related million, gas and and cumulative storage Operating the expense the Mountain the water O&M primarily inception of The deemed of was $XX driven award to of Responsibility payout increase associated program to incident, other the $XX were second operating $XX primarily million related given with depreciation second expenses MVP The for of the of was includes by remaining catch-up fuel million since award increased of than variance quarter natural compensation the probable, increased Act. The expenses of award. the SG&A, the expenses. enactment the Rager expense

With August August dividend on $X.XX XXXX, XX, For quarterly of following MVP. the a per XXXX. obligations the the and X, wanted completion shareholders common of the that underway we share contributions MVP the gathering business cash to effective remind second on everyone quarter, of E-Train with record at in again, agreement EQT become will construction of the pay to close of expected contractual

today, detailed the was as expected EBITDA. investor adjusted adjusted EBITDA, is XX $XXX estimate annual will on that expansion approximately annual and $XX contribute earlier our Equitrans approximately annual million approximately million First, project of of Hammerhead contribute we MVP $XX adjusted estimated presentation million to of to EBITDA. of contribute Slide is posted

Bcf and per back be EQT, to in-service, would we the agreement in which year up then to stays MVC X.X at day Bcf could X.XX $XX MVP The X gas With volume gathering then third then XXXX. XXXX the goes the the through day prices. commitment also through X Henry per be to minimum X Bcf to regard per million Bcf earn the in following per X on eligible With XXXX, year year. and day Bcf for with day day for to steps depending up per bonus Hub

MVP there contingent lastly, in-service. relief remains specifically is to EQT that And on rate

XXXX. in million $XXX could Assuming up and commencing up to January XXXX, approximately contractual $XXX obligations this approximately million be on in XXXX X, to

provides gathering also EQT services for gathered that the separate received credit rate Additionally, certain for fee Global a certain under GGA the transmission volumes transmission contracts. for

investor we XXXX in-service The XXXX. deferred completion ultimate of deck, provided on X deferred January was this X, estimated actual and subject On to obligations on year-end Slide the term. revenue contract based the through date. the the MVP contract is commencing Again, our annual revenue MVP

of In terms maturing to billion. After quarter, and of the approximately $XXX $X venture debt issue to in senior second be MVP we level the XXXX. $XXX anticipate financing and we portion in-service, at our notes to delevering retired joint plan approximately plans, million during million

our EQM retained debt. to From These cash flow free debt proceeds and for are utilize there, expected we reduction used delevering. to to down further expect be pay

release. And guidance, lastly, XXXX in is today's available we earnings refined which our

XXXX, are primarily in million other and total Assuming with midpoint free in expectations. the cash expected year All free MVP full retained decreases and CapEx. than previous flow guidance on year-to-date by largely our higher about was financial at cash completion actual $XX results previous the line guidance slight based year-end flow

back the I'll now hand call Tom. to

Thanks, a MVP. long challenging for journey Kirk. and been Well, it's

opposition the we highest we that confidence expect While will we the up, complete degree have to give don't of the project.

commitment and of issued of construction, the on which with safety completion the focus our in and protection measures are working portion environmental the includes everyone right-of-way accordance stringent the remaining permits. responsible of Our on

benefits also natural helping goals to state and to of reliable forward national and to enhancing achieve energy while natural bringing lowering and look affordable carbon for security gas We emissions. the consumers

With happy your to take questions. we're that,

Our first question Instructions] line [Operator the with from UBS. of Brian will come Reynolds

frame a where of to 'XX commentary specifically. project on time incentivized your in to first But there EPC perhaps is versus could Or year-end talking 'XX the of the building. year-end developers winter? aligned and half around MVP MVP just the seasons early this construction or in halt kind contractors given touch timeline? 'XX was just Maybe timeline, kind around are parent Previously, to work by all through always and 'XX, point there the complete difficulty winter just curious about

Tom is this Karam. Brian,

we all, the parent. of first So are

the Roanoke and partner We Gas are with in ConEd, NextEra, Light. along MVP Washington

X months' ordinary fairly course weather of be to impact X As conditions, some of some we're expect repeatedly worth construction. line year-end. with MVP we've there going could absent that said, any we as those construction we're into to where bring It's But project. confident around extreme

Great. absolute on perhaps of of that happen complete, update And just of or the JV about the level whether after? billion timing perhaps or then talking debt migrating with to just project give can cost once you could total the MVP MVP before an the perhaps is us in-service $X.X just the amount, given and that

talking about project-level you Are finance?

Yes.

our will Treasurer, for question you, Janice Brenner, answer Brian. Okay. that

credit as in to of that target depend pursue once yes, debt factors, will The project MVP which ultimate do variety conditions, well is shipper size intend rating quality. Brian, include underlying a level the the market on as we service.

million mentioned $X of from Kirk the as E-Train cash issuance. JV-level to roughly $XXX debt remarks, to prepared But we anticipate back billion in the

by with to will work refine of So we work approach as those year-end, financing. banks our partners we our for completion that details and and all the towards

at I'll remarks. [Operator to Instructions] no closing questions call further have back this Tom Karam And turn the for we any over time.

today. Well, us thank you all for joining

a of lot is do us, work ahead business. midstream of really in which what have We we the

underway. speaking work we this to to quarter. excited we're other all to as look well continue complete Thank you So you. projects project And that have and next forward we as the

thank We you you disconnect. and that for may joining, conclude and will all Ladies meeting. gentlemen, today's now