Equitrans Midstream (ETRN) - 2023 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported a net income of $130 million for Q3 2023, with adjusted EBITDA of $250 million and deferred revenue of $83 million [11][16] - Net income attributable to E-Train common shareholders was $113 million, with earnings per diluted common share of $0.26 [16] - Operating revenue for Q3 2023 increased by $6.8 million compared to the same quarter last year, primarily driven by increased Transmission usage volumes and higher water volumes [40] Business Line Data and Key Metrics Changes - The company gathered approximately 8 Bcf per day in Q3 2023, representing an 8% sequential quarter growth and 6% year-over-year growth [34] - The Transmission segment commenced construction of the Ohio Valley Connector Expansion Project (OVCX), a $160 million capital project expected to add about 350 million cubic feet per day of incremental capacity [35] - The Water segment completed the trunk line connecting two above-ground storage facilities, allowing for the delivery of over 140,000 barrels per day of mixed water [36] Market Data and Key Metrics Changes - The company anticipates annual gathering volume growth in the mid-single digits following the MVP in service, driven by growing demand in the Southeast [7] - The company expects to complete the MVP project by Q1 2024, with a total project cost of approximately $7.2 billion [4] Company Strategy and Development Direction - The company is focused on expanding its MVP capacity by 500 million cubic feet per day through compression, which is expected to improve pricing dynamics [7] - The management highlighted the importance of environmental protocols and safety measures in their operations, which have impacted construction timelines [12][32] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting the Q1 2024 target for the MVP project, citing steady progress and favorable weather conditions [46] - The company is optimistic about the financial relief the MVP can provide consumers this winter [33] Other Important Information - The company updated its 2023 guidance to reflect revised MVP timing and project cost estimates [20] - A quarterly cash dividend of $0.15 per common share will be paid on November 14th to shareholders of record [20] Q&A Session Summary Question: What are the underlying assumptions for the MVP timeline? - Management indicated that they should be able to meet the Q1 2024 target, with steady progress and sufficient construction crews [46] Question: What factors contributed to the cost increase for the MVP project? - The largest factors were linked to the slow ramp in construction crews and challenges due to heightened environmental protocols [49] Question: How will EQT's new firm sales agreements impact cash flows? - Management confirmed that these agreements would not impact E-Train cash flows related to its GMP or transmission-based business [66]