TRGP - Earnings call transcript Q4 2024

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Operator

Thank you for standing by, and welcome to Targa Resource Corp's Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions].

I would now like to hand the call over to Tristan Richardson, Vice President, Investor Relations and Fundamentals. Please go ahead.

Tristan Richardson

Thanks, Latif. to Corp. Quarter welcome for Earnings and Resources Targa morning, the XXXX Fourth Call Good quarter release, accompany fourth in presentation available The earnings our the for earnings fourth on Targa supplement Investors quarter section. Resources at that website our are along call targaresources.com with the

Section to be the that In Targa's might in updated posted expectations has of considered made within Statements XXE or also presentation an website. Exchange statements. of forward-looking differ during XXXX. should forward-looking Securities include meaning statements results addition, Actual been projected materially predictions Act investor our the this call those from of could

For please a our latest could cause of that filings. refer actual results to factors to SEC differ, discussion

Matt President; Jen Meloy, Chief for speakers Our Executive and Officer. Byers, be Kneale, Chief Financial the call will Will Officer; today

the management Additionally, Pryor, Bobby Q&A: Officer. be Pat Processing; available Logistics President, will Muraro, and for members Scott Gathering Transportation; and and Commercial President, senior McDonie, team Chief following

I'll to now Matt. turn the call over

Matt Meloy

Thanks, Tristan, continuing our was on a to build good we momentum. XXXX year, and great are morning, and everyone.

our expectations. demonstrate results fractionation expectations export volumes transportation, with also record positioning significantly outperforming XXXX Our initial from the driving that volumes and NGL record exceeded Permian differentiated

and As deliver positioned to that significant shareholders. beyond, we continue growth to look we forward XXXX to believe we are uniquely for our

projects processing additional Daytona needed Permian announced that utilized our new this and highly all X much adding X XXXX fractionators is a different. And have at infrastructure record no With track morning. we Pipeline, We our of demonstrated additional X NGL was start-up. and plants, NGL

will in us of XX-inch diameter the with Grand a additional project, Prix Basin intra-Delaware Express capacity XXX-mile pipeline Delaware Delaware. NGL expansion provide that Our

in Galena barrels which to barrels per million our Mont XX capacity at new increase per our next fractionator XX, LPG month. will Park, our Train export export expansion Belvieu effective NGL day and XXX,XXX

construction. currently Permian our Our incremental accommodate NGL from volumes plants newly announced processing projects are under X needed to

These continue target returns strengths positioning critical to capital. to projects us attractive demonstrate invested to are core on

spending execution when accelerated our year. projects growth this need recently Permian volumes by deals. new previously grew on with time commercial by year-over-year to of relative additional G&P feet moving system. and thoughts multiple XXX an million driven XXXX, We was our would organic through have the XX% more This In plus estimated per growth than day downstream infrastructure last at our we cubic incremental

we talking far high were We our but the February. growth the surprised upside expected about exceeded last meaningful were we growth volume as increases, to single-digit

really our producer increased declines Higher onto Delaware expectations. of by was driven and success, oil dedicated our rock advantages activity in in commercial best systems. initial Midland areas bringing performance new Basins, and combination relative outperformance a the and to the certain of on to ratios existing acreage lower volume on Our and Permian gas being systems the volumes, volumes

began adding expect This to continue second XXXX. in we commercial with XXXX, positions wins similar currently into us volumes growth, that trends we and more late Permian along several in in drive that While growth our volume half even be from G&P estimate growth stronger will weighted. to large volume benefit to XXXX XXXX,

estimate free in year. $X.X and $XXX growth of expect further million system growth, EBITDA financial than XXXX. drive We These In we billion operational year of trends with year-over-year XX% generation flow. this will our of to cash another meaningful adjusted volume EBITDA on the and see the increases adjusted and our in expected results adjusted over in XXXX record was EBITDA record higher XXXX,

G&P of with volume plants growth significant in new our strength capital common of growth positions assets. versus XXXX Permian in amount repurchases million increasing position X increase of an time return beyond and $XXX during We for in to downstream XXXX, dividend NGL shareholders through to us XXXX, XXXX record a The a to are over share significant our also the our online to continue XX% coming the common deliver with and our driving to year. results

we a November, in we Looking expect share. announced per common annualized XX% forward, XXXX our increase year-over-year recommend to dividend to

Our focus isn't changing.

is with shareholders, Our and strong, including return balance repurchases. sheet common invest flexibility continue providing to organic to to continue attractive opportunistic our to to share growth us in capital

our continued and the while providing to on efforts. call role a we Jen, in safety played execution proud over are focus and customers. recognize service employees I Every would thank group best-in-class and across turn their to I like Targa to within Before huge our of our and execution year, for reliability the their

total our shareholders tremendous highest on. is ninth return with a provided build the which XXX, want the accomplishment to in that S&P we We

X Lastly, engineering continuing years across Jen's of into XXXX. to X, is Targa. and commercial going to part After March President operations I as am our to that focus announce pleased last the functions Kneale has, development, is for shift our lead Jen and effective moving role, finance and functions the her she administrative now leading

Over to you, Jen.

Jennifer Kneale

Moose everyone. morning, and of utilized. on a is Matt's Building there remarks, activity is on Starting now the the our online our new in lot Delaware, Good Matt. in plant Permian. highly Bull acreage Thanks,

that approximately Basin. and cubic the and feet Delaware XX-inch front-end treating sour gas bring per Delaware completed create the the to capacity day X our facilities Targa's billion treating These feet cubic processing of pipeline gas projects rich million largest Targa's in also day connects system X.X and addition We per XXX of fungibility. treating significant

are with next Bull online in of plant X XXXX, II expected progress make II to Moose our the of in under quarter and our first construction the quarter with quarter Falcon customer continuing Delaware expect the XXXX, are volume position our a growth great second to that plants We coming on plants XXXX, the in in in online within be to plant online X Delaware. we in handle

Basin. Midland the to Moving

plant We under Pembrook second our expected with quarter XXXX, of II plant Pembrook additional quarter late online in online startup. and accommodate plant our II we XXXX. and currently in next X the Delaware, plants Midland at when growth on need with utilized October plant the evaluating came XXXX, was to both fourth East and of online online Permian quarter the to third systems. construction our the plants Across East of in fully will move we Greenwood the are have our in continued Driver Our forward our

NGL record and Targa's our XXX,XXX Turning late benefited million coming XX averaged in Pipeline a coming into service quarter as Transportation to segment. our day fourth Train per Daytona service per August October. the and late in X.X transportation barrels fractionation we averaged during day from volumes Logistics and a record volumes NGL fractionator barrels Pipeline our into

of is this the announced volumes. Our XX-inch expansion XXX-mile we flexibility of Delaware Grand our Basin to lines takeaway to needed assurance the Grand XX-inch Prix that NGL growing moving Prix producers. further diameter consider lines enhance residue accommodate to our part or options intra-Delaware Basin flow pipeline, forward providing service have repurposing with large By we existing and morning for gathering diameter opportunity a to

looking and of medium-term continued mentioned increasing provide plus we to strengthen, deals the Daytona transportation long-haul online with Our coming previously forward. NGL that flexibility volumes us third-party transportation has outlook

handle growth Given robust NGL the our outlook growth will our our anticipated supply downstream G&P for and growth in from remains Permian business, needed be expansions system systems. our to much

of and at XX, on expected much be fractionator remains Our for XXXX track third Belvieu, Mont the Train is in to startup. next quarter needed

start-up announced newly is Our expected first with to XX much be Train of the also quarter needed in estimated XXXX.

complete barrels XX business Park, we loadings quarter the million export per month XXX,XXX record our month averaged a fourth our LPG track per our fourth to quarter, expansion of and on XXXX. barrel Galena at during the In in remain

system continued LPG's, the in expect announced demand the our enhance in new online of increase Galena strength expansions Given butanes will quarter significantly the for we rates fractionation propane third that and LPG plus in our our Belvieu facility Park this expansion loading and between morning incremental U.S.-sourced refrigeration comes be another our result it addition to export global project flexibility. pipeline in unit, much Targa when a The will in of XXXX. and Mont and needed

During of attractive XX% partner This allows Cedar operational our structure cash simplifying us we fractionators net liquidity approximately with our and provide $XXX to purchased Bayou million return. interest BP's CBF. at an the consideration of while transaction we XXX% own fourth quarter, in for now

preferred announced also this definitive in Targa North billion. We outstanding LLC, morning equity a Badlands Dakota which repurchase holds our the all agreement approximately of to $X.X for assets

conviction Grand we at executed Badlands largest in our maximize the Prix. When plants structure, which capital proceeds was the the and multiple critical of the with dilution were large us commercialize given any February strength and midst we Prix building lift Grand XXXX, in fracs to our TRGP help of ever, outlook. and to project We without time, transaction our in

out that then taken without The piece had fixed double-digit The now We of cost keep to a last charges. for of preferred have creative back annual now million out financings taking is low utilized Blackstone investing simple. $XXX the essentially dilution. we rationale

cost With impact the than $XX it our have sheet, providing and we to lower savings of debt, cash strength can of much leverage our with more refinance million balance annual ratio. minimal

strong incremental XXXX, venture XXX% investment fully own to free characteristics Badlands for cash resulting We January which it from all attractive approximately XXX% X, for we joint is effective asset, make million a flow in and now date that again, of fee-based of will of made will With of the attractive it EBITDA. us owning an own for of benefit $XXX in now. XXXX Badlands

were have we continued volume forward. year XXXX, growth because this spending time outperformance expectations XXXX accelerated of we mentioned, our not for into the and significant that of last at growth in Matt As forecasting looking

billion several is high that growth we online to second framework multiyear of Through ROIC spend volumes. the other Targa's and the XX%, Permian given support Daytona XXXX. provided had illustrative in February over end last was an history, X and major growth in approximately a project detailed which of projects to largest We $X.X the years XXXX, past our contribute only come capital partially strong, single-digit

While see projects clearly are that This volume which growth we from this forward. additional framework than added XXXX. XXXX. capital to more growth to volume success given more several our commercial lot a going And benefited in downstream accelerated growth holds, likely

few framework likely but be over the higher. plants to helpful online a be in environment, in should to continue The years lower capital our next is growth come XXXX. X spend

has and accelerated processing additional beyond, will spend. and volume growth We need downstream XXXX that in

Importantly, time. believe increasing of these and driving flow core all over we EBITDA Targa attractive in to will leverage existing footprint cash and result our continue free projects to are return, rates and

weighted As over increase our the a We to capital a growth, full in $XXX common substantial million result investors. attractive to our increases price shares returns of for at $XXX.XX a of opportunistically return year repurchases share XXXX. and million of meaningful strong average we $XXX XXXX, repurchased during continue of

more cash flow This multiyear operations was beginning operations return at model capital adjusted cash of our than a we to the to looking discussed, the results our shareholders of flow previously on shareholders XXXX, continue from to quickly. we've framework we XX% with year, In we expected to forward. basis from of returning returned with XX% multiyear last positioned higher than of shareholders. strength the Consistent us more to

continue positions balance sheet shareholders. for will both return We an to approach invest Maintaining to creating our all-of-the-above value to to our strong capital opportunities attractive while continue on us organic shareholders. increasing growth to in focus of our

continues to and an meaningful a proposition share excellent by outlook. increases dividends growing count compelling per to reducing value EBITDA, be Our share, supported common

of employees. appreciative a so was our year of our efforts company, big XXXX the I'm for and

We the are have lot of a momentum about excited future. and

the Will discuss XXXX to now outlook. and our fourth I'll our quarter call results to over turn Will?

William Byers

quarter. was billion, was attributable sequential X% to Jen. $X.XXX was for which adjusted The reported over resulted fourth EBITDA the higher our third Thanks, increase the system higher through volumes increase volumes, Permian a quarter quarterly Targa's in integrated NGL a over EBITDA operational a record XXXX financial the and Full billion, despite increase NGL and year record supported by XX% adjusted prices. weak metrics gas across natural business. $X.X was XXXX and company

guidance. We $XXX opportunities optimization not NGL included million that our XXXX with from marketing across approximately of stronger-than-expected opportunities benefited and natural in gas also original were

various projects. $X as result estimates that approximately our came growth Growth spending of spending to projects spent growth we billion commercial Permian previous in ahead our attributable on shifted XXXX, the acceleration During capital and capital spending into success of of XXXX. a

to the capital our Xx. below our consolidated the balance target with mid-BBB rating range net Our At strong X ratio the approximately investment-grade ratio ratings X leverage each maintenance agencies. year, X.Xx of long-term million dollars. $XXX net have of was we of the leverage our end stable sheet, midpoint was With of

to range. be XX% XXXX We expectations. very year our increase on outlook midpoint adjusted of XXXX and the Turning billion $X.XX a to XXXX, $X.XX between are about we billion, estimate our based excited over EBITDA full and

We expect is drive The our from contributions and Pipeline operating full benefit Train and Basin Logistics Transportation will positioned our volume across year the Permian margin NGL growth Daytona to X continued segment businesses. well and & of XX.

gas, commodity average outlook Our prices natural crude. assumes gallon barrel $XX $X.XX barrel for NGL $X.XX of and weighted Waha per MMBtu for WTI for our a per

from cash and The with us to business the support price non-fee to remaining fee across ability increasing cash XX% benefit environments and provide XX% G&P we XX% commodity across positioning fee-based, us Our through are invest of than commodity stability hedged the XXXX. flows floors greater fee-based our continue our flow our while lower and prices. higher businesses will to about margin margin have

associated $XX will $X.X commodity on guidance, around adjusted going capital for into announced new that X would momentum reduce X currently a increase year success highlighted, with XX addition This transportation. XXXX We for when adjusted our next and spending plants spending on Permian $XXX million. prices in Permian EBITDA we XXXX by commercial to decrease Relative modest long-haul to the EBITDA budget and projects forward spending billion long us our would we the well million, spending around higher move of capital Train billion associated with a need $X.X today, evaluate the to position in while XX% lead estimate are growth incremental items by year system will includes time expansions, move Matt potential recent spending to full continuing XX% and NGL underway, full financial downstream XXXX. our to with

flexibility transportation volumes agreements As when NGL for Jen us and provide needed. mentioned, with our medium-term next third-party our expansion NGL baseload pipeline

year-end we $X.X and enhances closed flexibility ratio position net Our leverage going revolver February providing flexibility XXXX forward. our continue credit XXXX, to February, expect continued execute our is revolving estimate new maintenance target maturing facility comfortably to million. spending In on strategic billion capital within liquidity upsized range priorities. of with Similar X-year, on long-term XXXX. The Xx end for to a we $XXX to our our X to

the for end billion. at liquidity fourth available forma approximately the revolver Our new of $X.X pro the was quarter,

who There in cash such is policy our and reduce depreciation our cash that our changes new XXXX. federal would XXXX taxes I thanking and relative to in in may as subject X,XXX on success Jen or effort eliminating expectations. like Matt a employees execute Any the to full minimum no administration growth tax bonus as to we continue team would possible. our made day we to be tax our change program. our AMT assumption taxpayer to the have reinstating the join favorable every by

will turn to over that, call I with And the back Tristan.

Tristan Richardson

line for Will. please Thanks, Latif, the open Q&A.

Operator

Jeremy [Operator Tonet line Instructions] of from question Our the of first comes JPMorgan.

Your question Jeremy. please,

Jeremy Tonet

forward really, growing faster. wondering high-level year, here? the expected half how later pulled given these commentary I pull back year. the with grow being in accelerate trajectory could congratulations point I the could things would about think forward you growth year believe about higher? I well at than going it of across I Jen, And this there's provided, just wanted seems like into, that outlook some trajectory are should go, the if just guess, over as you on activity the of the back guidance I'm how guess, first there, half And at of to forward I projects share, the previously guess, EBITDA off. XXXX here, the think as better And point CapEx this the thoughts the any we

Matt Meloy

start. really Jeremy. us, were The say, is for Sure, really strong to outlook, this I'll last sitting has relative growth growth year at I'd every outlook multiyear we the for time. year. where say improved Yes. I'd

of back-half that the and is our at weather the rest through the of look as of the This back freezing look of first is the This we this in just growth. commercial deals into pointing it more our volumes to we success strong weighted talked on continued producer and year part saw round we're year. 'XX also kind contributing for impacted As after weather. by more and the we at round forecast, then 'XX. about volumes XXXX Permian start part specifically, QX really had and that's year, year, We've second NGL in really is we year year half our of downstream. impacted impacted volumes Last

have here we some had weather So in quarter. first headwinds the

But potentially this XXXX year strong. of the is forecast it's XXXX. kind look our for really of build a than just outlook looks producer bottoms-up our And stronger we through year even like

Jennifer Kneale

think year. And well. We're plants when as XXXX, outlook excited X We've about online got Jeremy, really trying But you tremendously multi years I'd far just look excited year. we're online in about growth that really X just too of here next strong this not beyond add, plants of about. to a we're coming this coming year

Jeremy Tonet

it. Got

this and looking in So XXXX looking did better XXXX better point past. growth outlook it than at today than the long-term

that got in there. around 'XX? for 'XX was the 'XX. that we then obviously, how not, I EBITDA about some in not it should guess, optimization reason Just materialize believe baking is business in this, and there occurred wondering not comments you're And think So And any there optimization guide but on the is I does to some that? think again

Jennifer Kneale

XXXX, then present we're August, that us forecast seen across end of about guide in course, increase thought we meaningful And what we and gas not you've, but November, themselves, natural of you one XXXX. that of the when today up our us to range. side, range and We natural full footprint I high think That's in opportunities always part And when in of opportunities way. already we're the a guidance our gas you that be we so year the with present. would each those all we -- marketing both the saw EBITDA. of let saw conservative ended us say in pretty year for where at we it's we'd reasons then the beat liquids

opportunities year, that themselves, process think not accounted into but essentially. this bake we overall planning our So to expect they're until we for as it's something I'd similarly, about present

Jeremy Tonet

Got it.

So the optimization possible is much very still plan. to upside

me. for it that's think I

Operator

Research. comes question Keith Wolfe next of Our Stanley from Keith?

Keith Stanley

I wanted the of timing an did back excess preferred you from put savings cash it? the point? balance year noted And clarity, million $XX opportunistic and the have to Or just a on Badlands is just interest to doing to capacity? you're Blackstone buy-in option have start on at just and certain a sheet I Jen, think, this, you you so

Jennifer Kneale

at refinancing I'd what a our higher opportunistic with with savings cash was announced being it the that able call. low preferred, our being our million perspective, made much us double-digit we around all say world we from us and put to balance cost, in cost of from sheet saying quantified balance of savings sheet, $XX on to lower today on for the the you the for debt, sense a that the strength in the of

no any that, there get anywhere a Blackstone like with for eventual partner to had but where As options to make we decision. by yes, are a structure like were we means out,

of of million $XX We're XXX% strong throwing a on tiny that's XXXX cash a of taking asset year-end to a free fee-based bit and For ratio backs of owning generating us, and flow. of off leverage stable on now savings go was here of X.Xx. really it lot cash the leverage just a back really

Keith Stanley

Great.

'XX just given stronger including being on Second, wanted ask than of to buybacks 'XX. commentary, growth potentially some even I the

rerated about generally, has lot. think buybacks allocation just capital you a the stock when and So,

organic You're great growth. returns getting on

probably as on get You pretty M&A could good well. returns

are kind given you at thinking allocation overwhelming potential including of prioritizing how capital the this growth you're So, point, seeing? about buybacks, just that

Jennifer Kneale

continues above it to For all of us, the approach. be in

for course, really clearly do that And can will, a be we opportunities attractive us organic us our think of producers capital growth focus of I you're investment seeing that that and moving area forward. core lot to we a of invest that and in, support have customers.

that, increase dividend XXXX. a expectation repurchase saw XXXX. record also While execute of XX% us we're in really to in increase we it's repurchases you the we course, doing in have common our on the the opportunistic. like XXXX. dividend of And What program about Meaningfully is now

value presenting sheet with got balance see the extent between the to of presenting strength step itself is to Targa we've our the So what and in. of disconnect the a us, belief our flexibility we of to or market is financial the

lot even showing was how to going saw strong So in knew We second repurchases spades We showing up. the a you our than growth in on us be. in we execute of XXXX were It up XXXX relying quarter. volume was expected. more

strengthening supporting outlook significant medium saw of because opportunities. great we us on lot growth growth. of a supporting you executed long-term So of beyond. was step a in outlook commercial an that That's Similarly, short, and and XXXX in

accounting, a have on over the in And look are that to medium engineering, our organization everybody financially and commercial, going here got strengthening, opportunistically backs opportunities. that the is what long it term, makes got we execution of as on repurchases think strong the forecast is of We've organic really the on when direction. operations, and in employee our flexibility in out really we the moving right we that execute of And means and sense. we've that's ton short, proud across conviction

Operator

question Koletas next of comes from Our Jackie Jackie? Sachs. Goldman

Jacqueline Koletas

driving start, spending pointed to some are really the First, of opportunities? this you your the the Is just Or more as to mostly wanted sour on across is commercial this Where success gas across success a entire seeing whole? higher. footprint? segment G&P the you capital

Matt Meloy

highlighted of basin. All the then, investor and of the Midland the we've We in in Delaware slide, I and It good success our Delaware. I'd were X lot our positions dedicated. in lot And commercial available. we've you activity Pat, on, some already just say the of on acreage seen acres included acreage Yes. and provide kind larger of which with Sure, want us to producer we shows deals. really customers touch X nice in. and side mean, if jump actually of I'll a those that presentation Jackie. on millions execute characterize we both wins to sweet we that that That's to But continue have call both seen of And it, I sour. growth. developments. still and step-out a going have as there's

I think COX an our have able So our the good customers, a the system for fungibility amount when significant to us. and in very treating being off HXS both of fungibility operate for continue plants are of for to really and to and service provides of overall maintenance, it's paying level just

Patrick McDonie

Yes.

half 'XX this that's are just going why I completed prepared we think you I contract that in had example adding presentation, listen added lot in 'XX. acreage is the bringing that only did in our et and growth cetera, is, loaded of there we've Matt say to of to XXXX we already thing investor really gave our plus was add transactions contract the I list is long have as back our a comments, mean, the new 'XX And, would us. we line and under drilling that of there alluded position commitments sight a forward. and overall when the that -- the have acreage illustrative. on to new we under stuff to and producers got We've

in growth So we really Basin. outlook Permian the short- the are our excited for long-term about and

Jacqueline Koletas

'XX additional you the expect those just and lead does at growth like? to that. cadence of What Permian Permian at those additional here? looking plants with kind items might infrastructure it. of long implies move additional look long haul. faster-than-expected then Got kind point what of forward the moving And expansions beyond to would its And kind from for incremental what on evaluating Appreciate potential

Matt Meloy

normal. too Good right we're is not question. to and Yes. for do Sure. than plants the too And trying we of amount the little. What higher That's frankly, can not in X having see much on XXXX. capacity and you coming best internally, estimate and

If you look in 'XX.

on. coming plants X have We

a average We're of 'XX you're kind So for and those evaluating 'XX. X. X-plant currently

Midland, We the have picked for best out multiple those. best processing sites and new and determining in plants already for and location we're timing Delaware

to as think gave billion So pointed plants of it, call X I Jen year. which framework $X.X mentioned, CapEx a a for, we

feels all us, the term, And higher of and what right spending, seeing volumes our fairway CapEx is which what then kind in is it's accelerated of you've why I seen think down some short, and to the gather we're it that's like it's than we're downstream. here handle we process core and medium that. of higher NGL downstream move do,

years. we'll figure growth cadence X it's we in those 'XX out -- the plant all 'XX, of but X 'XX for right is to I'd we So 'XX, evaluating have continue kind and we're what for significant of for and say really see

Operator

Our next Gupta from question comes Manav UBS. of

Manav Gupta

over a there. pipeline. data here driven I'm understand gas to coal question scope demand looks center. like My very Obviously, by switching relates obviously egress just gas LNG, it trying to are to -- the you Permian and involved outlook with strong the

with about the Permian to trying just there? having people you're egress that understand out So possibly entire more this with conversation investing gas

Robert Muraro

we're This to get excited excited with Blackcomb, that done, in to and announced online get Bobby. as we Yes, our 'XX. pipe that WhiteWater partnership is

We continue another to there's as got talk pipe that egress. out we're is out every And That that conversations centers. LNG will the is, from gas demand are help what everyone next LNG, in Obviously, egress ongoing day. to as natural figuring anyone next where team about constantly. mix and of supplying of announced there pipe and out with the data demand that new coming those well Permian is, centers, data the

we pipe where data center is. the can next Basin And So, that intra-Permian as that pipe we've is we're at demand that out some get figuring next burned or centers we gas power deliver of in plants that can needed, when got evaluate Permian. where

excited figuring day and be But we're working all in 'XX it on and to when it we're because see Blackcomb does. day things come online that So, those every out. will much needed

Manav Gupta

some I'm the deals Perfect. some is midstream/refining asking a the very pipeline. to trying seeing your I understand could midstream appetite to growth reason deals strong organic their just for trying is bolt-on that pressure also. appetite of have would is some -- do? just was small I'm bolt-on peers of to if for you Obviously, And understand assets. start be the there divesting you activist one And what

Matt Meloy

sure. Yes,

at would of invested additional we of other think in In terms opportunity next an one multiple to opportunities. invest we pipes. part some XX.X% at investment as in and And opportunities we're the a I for going as looking other being pipe in the for opportunities. afforded takeaway, a is the will When to have look us takeaway then Blackcomb. to to us and solution be commitment And Bobby be to there Permian, gas needed what make mentioned, be

say in continue look the takeaway. yes, invest we'll So We're NGL XX-inch also I'd evaluating, putting Delaware we're long-haul Express in mentioned, as line. to we to

the long-haul Prix lines for make aggregate from residue want to continue to we We pipeline Grand have that our pipe some aggregate residue plants in those gathering large additional takeaway. whether and as potentially making Delaware, diameter to gas natural lines we're or evaluating to well

what a bar looked at either of have organic they've I'd most We additional I That whole broader And investments a gas to a transacted transactions. So, we don't we'll look if our continue have to and see. think focus. have mean on. we time And makes be has sense. as or of We've That additional opportunities M&A, our -- our on of high the we held. is grow, there say I going some changed do posture topic the of bolt-on side. parties really has opportunities with other spending residue these to on see we lot continue we're lot. we primary is to nothing that growth

So focus organic we've continued growth. to on

I that path. high, we'll kind continues of just the us and on bar to continue for think be

Operator

O'Donnell Our next question comes from AJ TPH. of

Andrew John O'Donnell

the these the I question build thinking on about just still announced. we spend returns the Maybe any was is Or X.Xx around before? you in Should have first on that multiple changed? about the projects outlook. bit guided time have just a wondering talking been way expected returns of if that be could you've the that

Jennifer Kneale

multiple. holds, which is is be going to the that a do record in AJ, that we've record to our able that we Jen. framework track this better demonstrated really to got than continue forward. X.Xx I'd that ought track everything say is we of And provided expectation able being before that

skewed asymmetric really ever what provide To here really You NGL return prices. up haven't weak in higher rates results XXXX, on you returns really play the the extent saw our we move We've commodity the in. natural would seen got of gas and recently despite on we've with see commodity strength putting attractive to do prices out upside, which invested the of us side. that that incremental

those day better out So to drive think every reasonable the to business. a assets is those working you're figure use of course, out to And as X.X% or bit to a our I we're returns point continuing higher. utilize little starting modeling how

the over NGL ramp been I of for has time. But than great faster than and which think what's start-up. even has to we been is asset that's transportation Other expect that medium-term us we those agreements. at Daytona, online we had expected, there ramp everything why do brought that some to an been is full essentially

we and better do to So that expect the than to our that, volume continue is been get that when more we'd returns the well. part assets able helping FID the online, made how us commercial and strength decision growth we as forward going quickly is of when team certainly of we've come commercialize to

Andrew John O'Donnell

quickly. versus there Okay. frac of pretty But in just these Great. ramp was just step on more service noticing talking how then pretty up QX about NGL assets Maybe that results big production. volumes kind in one and a the

provide Was there you Just step-up if increase? in that third-party comments involved some there. any on wondering could

D. Pryor

frame. we a X When that you Scott. that time brought in at over fourth of frac really third XX% look quarter. because and is course, nice at by on frac you fourth volume quarter. the online during the overall, we came quarter XX when volumes of that fourth our in fourth was this then, saw Yes, lot 'XX Train our quarter look quarter the A 'XX, grew train of AJ, quarter to

utilize we to processing to able had other our saw inventory to our we frac off us allowed well that stored. been then from at plants being all that as volumes and had volume of we growth work So offloading third basically that that as times parties

part saw that announced quarter. the the and the is will about the X.X that we those million to that we our which Needless plants all we've of barrels directed of to the when be on our of day to number will of during announced be to we've -- saw on on that fourth really XX,XXX much coming that plants contributes side, a of fractionators. plants So much barrels benefit of the you say, pipelines which the in think of Midland side, volume, of each XX,XXX Delaware

Train of us sight reasons today gives line XX. announced was Train That the and previously and XX why

of of the those with of when that already the plant in So 'XX that up when very coming Train now quarter cadence frac then, about XXXX are and quarter today. the announced think in lines well course, we've online third XX first you all

Operator

Wells question next Fargo. Our from comes of Michael Blum

Michael Blum

volumes. I I'll have just X on questions stack together. here them

quarter. first the on The fourth is

only only Your of -- -- of brought the year. a Permian you've on QX half fact second spite QX modest up and volumes on little that bit bringing the to sequentially in plants that's in the been you were

in about any overall the going bit said growth? volumes So a for I volumes XX% year, you guidance grew maybe for little be XXXX, full you wanted will in dynamics a should thought that. -- of there. I just does you maybe talk We can be to on the just 'XX And what assume then aware volume higher. bit

Jennifer Kneale

fourth cubic QX the year our very staggering about contract to a a of release relative press the QX, across up when XXX I a to the moving been was day, and volumes, cubic feet mean feet volumes on that of think million QX trajectory cubic you Permian XXX day, quarter QX moving pretty to million the Related growth we've quarter. QX. fourth commentary it a growth, low XX at did have feet And in rolled of the we margin day call We the beginning over that quarter-over-quarter then million to tried that QX. out to

going So we to that quarter-to-quarter. that's that to highlighted sure noise we certainly of create for was wanted what it you. That some make

we low I'd -- framework that said plant We've the got had 'XX, back Moose about We're that plant online, our we published the another in of underpinned growth later come high that we that a growth, comes February. just to $X.X Bull when about 'XX single-digit the half talked relative ramp. We've this say sort year. online. billion above certainly that case that last we think

really But plants a say back growth remind XXXX of to then XXXX in lot that. the Matt -- materialize as in going really when everybody, our to excuse really next growth a trying growth just was underpinning year. expect as is well. arrangements is XXXX. up of because and to higher to pointing incremental the X that's again, those attractive a significant plants see growth X ramp strong me, we're half half we're and lot which really 'XX back provide what We're commercial than said, as but continue strong I'd XXXX, year, that across in to XXXX XXXX So start the sorry, have Permian to going or

Operator

from Dingmann Securities. comes Neal Truist question next Our of

Neal Dingmann

lower the capital overall way this NGL all understand financial been asked ask different deal. selling course, on this I how cost I'm My of into would want wondering just again, maybe to before. you I consider the And maybe ability of the there. first price, the for integrated asset? just question, Badlands and it's strategy. fits a right

Matt Meloy

obviously into into into export. is for processing available in the the fractionation our it our is about but up NGLs those and actually way NGLs don't our those transport have Badlands strategy get fractionator. footprint. interesting and What's and We move gathering volumes Yes. Badlands, downstream is We invest our the the tied to all are

the would a downstream any lower business refinancing anything of or us get us with easier a do With partner have with strategic, out something owning to some do we bit So whether it. at frankly, that are, we there, those options synergies debt, Badlands. XXX% cost on from NGL the it's little

improves any Targa assets, no, to it look best about if dynamics that at anything, all change of position. So right? the So of its of it what's doesn't the kind for way

Neal Dingmann

just need question, new Pipeline. using the NGL Belvieu on that what's I'm the Mont I Sure, maybe when need? and offloads to are how you there, with all your flexibility. to Texas bridge you love maybe wondering, second And then along capital really just timing North would

Matt Meloy

Scott, you want to.

D. Pryor

That II which volume Delaware will Prix. obviously, will that XXXX. of you we're on side is give on off, But that line Basin think that. on barrels of Express of Prix. we number ties which when and In course, about on adding Delaware plants and is the XXX,XXX we a of a and XX-inch be fourth that basically Delaware, growth Daytona first just X, had and Falcon production Well, way move with that moving to on incremental seeing announced line then, little in line. Grand into That to will us the Delaware quarter bit side. the much of the the Yes. on That Bull quarter, Bull NGL allow second Express, description our of we're the move was be online the all the Moose Delaware about Grand I, to find necessary its Moose more

the XXX,XXX all about Grand moved Prix is into on way X.X per barrels million day. barrels capacity a leg South day the our quarter. We fourth Our Belvieu during with

we're have there. in on adds done we notes us we then something So we've of that, long-haul alluded certainly, we're to And that we're ramp a of. deals on certainly pipe. need us to some It's further that looking that gives studying And into again, still in lot cadence upstream allows and plan third-party flexibility of to operating the success a seeing our leverage would offload that announce that when stay is we've something hard. our our our to obviously, trying at, front with plants

Neal Dingmann

of all you in everything. right stay sure front I'm

Operator

of Theresa Chen comes from question next Our Barclays.

Theresa Chen

the next back infrastructure see is year. downstream I your including love beyond the if accelerated But kind if growth thoughts of coming as then to that and you would acceleration up what quantify half growth curious today, and Looking see visibly get normal, how curious strong your the a based plants more X CapEx above-average you you tying way as I'm in do come medium XXXX, needs to ever, inlet volume strong you're back we when and the to And on look revert clearly, any at to volumes. there? online. you of in from that, metric perspective term, strong in XXXX into can

Matt Meloy

didn't up as giving of difficult. XXXX, you and exceeded decline good being more in is saw came they we had Producers we Part sure. we multiyear much. far volume Yes, better, ended GORs estimate, a active, as increased, wells I that. on mean, guidance thought

So we saw a good outperformance in 'XX.

of also what part our for strong is in exit is what do half back A how 'XX ramp 'XX. things and just of the 'XX goes into

we plans we've producers, why look for see I'd we're year-over-year and But basis, nicely So -- we just we that still getting we 'XX. just up from When the strong an success is of not half we're it's 'XX. XXXX. indicators strong 'XX had from of at pretty have just growth south very in saw looking that. the commercial the strong it 'XX. like definitely 'XX. in setting But see is not back drilling in currently say on in growth 'XX. It's as annual still you giving We that's higher as a see

the And when morning export additional into with some, cadence, more normal again, have we you an then, of capital frac. downstream chunkier announced kind projects this we've some get yes, that terminal, here

We just have came on. X and XX Train

XX. and XX have We

a it's CapEx we're through the all sorting G&P volume growth dependent like to what lower is that what cycle those could Express. next lot perhaps Once We you point. still get what in the the build on for that a the cadence looping out looks again, -- side, side. after of have and going on in expect on at service downstream be see, the Delaware to this But

Theresa Chen

the chain flows view But also on curious push purity Understood. demand customers? And completely to collect products value volumes. the and that need ebbs your and understanding you your to infrastructure these the supply your turning fees growing of move, international the of hear to component from on export will

D. Pryor

Scott. Theresa, is this

in it's grown and XX There if their with look That's to the growth on butane continue. burning side. you to on are volumes majority First LPG. and to There's the both for frame. XX% predominantly market growing very to efficient, share that LPG and as is of volumes countries, provides when a XX% then Asian trend just find from clean U.S. the are has market still to on propane that would time just that number a is vast way that's a growing volume. the of LPG that and has there less at marketplace that that the can out in that still LPG U.S. the fuel that molecule Xx need of manner. a fuel, mobile obviously, We of at that's expect in effective coming off, something again time seen the that grown that the And just than and out you tremendous X.X years, look well, when we've the market frame in today, centers

we So, see continue. trend would that just

we just expansion unit, a of of that expansion $XXX it's and a And that look million. It us, than is for includes at an cost export a all refrigeration less includes project, our adding pipeline. when so

us continue and compete stay for that volumes sure So ability attractive be for the us. marketplace. on to very system to exported make provides project is to the the that a It our and can

Operator

Our Bingham of next question Brandon comes Scotiabank. from

Brandon Bingham

near discussions the and been I quickly benches if could to strong then something any specifically if year and contemplations within to getting on outer potentially year this to in or go ask in outlook the of and more tailwinds that that's outlook. with if back be wanted just And your there's years? I for just or the any this Permian deeper development customers focus on basin? activity the wanted sort for efforts schedules delineation medium-term you're there's that

Patrick McDonie

tested drilled is to in both multiple and a Midland. getting Delaware bit been But, just Wolfcamp Permian, of initial certainly, sides et Yes. the the right? of question, different little It's a or versus the loaded then relative cetera, horizons the reasons, Pat. frank. are other Delaware both benches look that there's certainly, Delaware would a This benches of deeper which kind parties we're the the definitely related, basin, And a and And think side, for the developed. the have is at waited little bit primary to Midland component be stages I have the to probably about the quality in now the you that in say in seeing in horizon. Barnett, be the we Woodford, of some relative rock the ahead And Delaware when that up sour to either

they good in But we'll a yes, will short there's how out. of economics with all are the us. guess answer is of And over see we is, And deeper horizons, little plays and interest I the seeing developed the that frankly, bit get time. expectation

Brandon Bingham

where approach like And sort a payout currently to alternative just high quickly could to know XX% But thinking XX% taking returns. today? previously shaping to don't of sits dividend with cycle it of the it in just this through understanding too the asked Just buybacks, the thinking go there. it. special that up get Got want dividend any you how stock if or you And something about then kind that fits all the and how with executed XQ? in year back levers we are target? above I was you a but other through you if the buybacks how see shareholder the you base that just guys through stock might with consider where

Jennifer Kneale

buying little really then, a the a flexibility. Jen. of our say of of a that's thinking where where of consistent at going really put dislocation, back Brandon, this we with third balance it bit have quarters we since . higher saw each in. maybe than Really we've a lot and couple prices irrespective the step saw quarter program we previous quarter been repurchase you it's got is of With when all about the we've share in strong how I'd quarter XXXX. place sheet, been to way that in a

share return We've But repurchase we got from after report utilizing shareholders executed program. we've that like our long-term that opportunistic it we have outlook. on that a continue really fact an the to it. with get really can strong increasing short, medium we provide And capital and conviction on to we

And so year. hear year this or don't is next it think I what going you about think you're how this should or quarter-to-quarter for out forecasting come to is this us and say, we're

a well XX% We got to XX% above our dividends increase to returning we have of repurchases. models. think that combination And high what and And thoughts ability say value opportunistic balance is worked continue expectations and course, XX% on we'll well. to in a shareholders multiyear that all in really as growth flexibility that I for capital combination it and to forward can that, of framework. projects. be the we've framework definitely to think I think that But the the we to above And has us. will that And we a that's value got continue the we we value fact is us of through approach I return you're dividends then in XXXX. return hearing value through a shareholders And capital our we meaningful holds, invest as time. And of capital we organic running and move repurchases strength. sheet

a see to we it really look need so And don't we forward. change as

Operator

from comes question of next Barclays. Our Harry Mateer

Your line is open Harry.

Harry Mateer

talk I little sheet bit. balance want about a to the

for consistent range. even half mean, years lower the to of X.X, very that previously at messaged in the past few the the narrative So you -- but you preference X.X also be to has I from leverage been a

be term? I'm of being prospects about So Targa in years. the with expected now in wondering in near few how range think CapEx just higher half to lower leverage the next to medium for the that on the we should

Jennifer Kneale

Harry, this is Jen.

force that's lower end X.Xx. that several what capital I don't very said we of X.Xx. before, business consistent a trajectory of ended years, the our leverage way ratio I the into do out But perspective. X at like need leverage comfortable XXXX with see us we a repurchase as day, really down the that currently we think through But what this where are movement of from But just I preference. we've higher. The we then the also the coming over growth to cycle. But managing a look think little end Badlands we're bit natural think as definitely We our fairly the still takes a next at to our current that is quickly there.

move increases come lower projects we naturally just X in X.Xx. of meaningful As leverage the these our that will year-over-year benefit EBITDA towards online, from contributions down ratio to end

Harry Mateer

cost and Okay. optimizing debt, on with notes cost of more consolidating just bonds have some market callable your then versus trade Badlands where And comprehensively you higher that you of some addressing do generally, thoughts are wondering, any capital, given today? with still your coupons off

Jennifer Kneale

debt, I cost on billion at think can level we $X save team it. and drawn opportunities how repurchase. revolver. has across Badlands the are we've there more got, to out accountability, if we'll Right certainly, now, got we're We've finance our that take the says, evaluate higher entire of always of than course, then looking essentially money which organization to same our held best and

right and those the by new assess consistent our evaluation manage time utilizing maybe coupon always team. helping more to bring at continue them to to probably callable and potentially liquidity but that So a out. term short focused on will or what finance That terming notes trying we're either revolver our in higher be to position, looking refinance

Operator

Global. Sibal of Our final Sunil Seaport question from comes

Sunil Sibal

the everybody, and time. for Good thanks morning,

on play, into all your I So off sticky. the that probably risk I to any you come in to to is on manage capital seems anything inflation or U.S. of pass aspects costs management able how these to potential know cost environment program? returns It curious, tariffs new going continues And you program. customers the on up. you if Are the start U.S. like capital wanted to be build in your was investments?

Matt Meloy

Yes, sure. move prices Sunil. up Yes, seen we've here. actually steel

Just of of the tariffs. talk kind

plant no, up, percent it cost you budget. overall modest seen as at overall as impacts a move an the it's or I'd a putting pipe, as impact NGL an have steel But or steel CapEx place, happen -- it's whether our it capital NGL of costs, pipes it's contribution. that plant look processing our a we're say We prices -- processing in does

manageable headwind on the some We'll So contribution on -- projects. these CapEx. have a We've I'd a still modest get manageable, the actually worked say a of of it's increase of some our working with steel. then you good of any in supplying returns. overall percent a U.S. projects

to we So the subject tariffs. aren't

I bit one. headwind, a will but it's managing procurement a it. of be group our think So a is manageable It

Sunil Sibal

export NGL seems heating up the it side things, bit. on competitive like then of And a the is landscape

targeting obviously correctly, announced were if this talk mostly And I recently? the landscape curious, You about you changed significant expansion Has if American the could that I Latin today. remember there. you competitive was believe market. I

Matt Meloy

NGL or Yes, The market the LPG competitive. export is I'll and sure. start, you -- add can Scott, then on.

there's players. multiple So

It will with be gets facility when So another being it's another competitive built. built, now. competitive one

anything and do We -- our expect So manage that. volumes do we to dock, move we've and team. been able with our to to system add? well quite continue really from our we across have to Scott, our a good

D. Pryor

attractive long unit a When ahead. operating lot along the refrigeration from add Park, less contracting for to back we us all gives just than would the it's and situations. this is earlier, well certain stay to Again, new with job both project docks. contracts, fractionation with of existing term forward, it I to quarter comments leverage our Yes. because And now always a as this, that, move the across of well the adding our fits Belvieu and Galena needed we look $XXX way pipelines new renewing down of export coming from add We again, this a very do relates third going business tremendous team our XXXX, us. pipeline of a we well short contracted. million very term in online it contracts, brownfield a our the it's with complements plants, overall in LPGs to at project need cadence to that very for

of actually we've like project. up also So, advantage over fit marketplace. take of new a we'll number the that fact expansion contracts, this continue time contract I got to that heavily volume ramps the and to

will and very dominate project our we is in continue general, feel share to market and with market we again, it the the export to And So, grow. comfortable today. that continuing have overall U.S. the

Operator

Richardson I you. like now would to for closing back remarks. Thank to turn the Tristan conference Sir?

Tristan Richardson

interest joining call this everyone, operator. morning. in We Thanks, Targa for appreciate Thanks, the your Resources.

Operator

call. concludes This Thank today's conference you for participating.

disconnect. may You now

Targa Resources (TRGP) 20 Feb 252024 Q4 Earnings call transcript