PBA - Earnings call transcript Q1 2022 | Pembina Pipeline Corporation

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Operator

Good day, and welcome to the Pembina Pipeline Corporation 2022 First Quarter Results Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Cameron Goldade. Please go ahead, sir.

Cameron Goldade

Anna. you, Thank everyone. Good morning, Pembina's from conference to to and call first quarter highlights the review of Welcome webcast XXXX.

and Sprott, On some the Vice and of Corporate on Vice Development judgments Loduca, Jaret President comments Sustainability President, and Legal & External remind Stu Scott Officer; are President, Senior Corporate Officer, Affairs and Bishop, to President nature Senior Services. projections. Ventures Senior and and may Vice call with Marketing New Chief you Taylor, me Executive Pembina's today Senior today President, Chief Janet Operating and Chief Eva Burrows, that Officer; Officer; the made in estimates, be like I'd and current forward-looking expectations, based Vice are

Analysis today imply measures, and are actual To of non-GAAP SEDAR now or May express to opening online the learn subject March could as to for XXXX XXXX, issued risks XX, the to I about uncertainties, dated expectations. may statements EDGAR. the we to on information these statements results non-GAAP Further, and remarks. company's cause measures. Management's X, please the over more make materially well ended release see which and differ from both which pembina.com period are as at Pembina yesterday, turn available things and will some press refers to some provided & Forward-looking forward-looking Scott Discussion

Scott Burrows

past by adjusted and same record in us all-time from Pipeline is which of of marketing the systems yesterday physical grew trend allowed as monthly assets high. a XXXX. release excellent is with to deliver our announced Pembina's on A to the has first We EBITDA continued to over XXXX, serve quarterly into the good systems, reaching Conventional volumes volumes with service the new of many Pembina's period business, $X start. into broader our significant proxy results, business, an Cam. billion, X% contribution the placed quarterly quarter an Physical year of nearly Thanks, benefit in off growing compared strong April key for which a company. on the for achievement That volumes XXXX

in a outlook strong with will for the a $X.X the of a positive XXXX guidance billion moment have year, raised quarter billion. and to detail to rest first Cam As adjusted EBITDA $X.XX our we

In a to excited addition financial announce quarter, we two strong important developments. to were yesterday additional

midstream was acreage producer Under from exclusivity majority Montney producers' Montney within services are and being The the B.C. play. previously which with dedicated exclusions, from announced the basis in premier of producer, preceded acreage agreement Canada which its liquids has developed. development subject from is of its of resource Canada's of with first to fractionation the the to multiphase the ConocoPhillips arrangement, agreement arrangement. previously by take-or-pay upon XX-year region ConocoPhillips Pembina Montney new B.C. The a thrilled certain agreement area, commits the Northeast liquids-rich a a liquids volumes Montney a Canada Northeast we Northeast and ConocoPhillips production this the in was the a on complements and announced transportation for B.C. the acreage development agreement second

safety our by In service third we competitive as from track benefit B.C. the we commercial of new expect competitive infrastructure, leading Northeast offerings. regarding Northeast integrated and to in we certainty to and the to are strong the Montney and Pembina have basin, commercial important of agreements strategically record a development. poised and driver continue area environment, value increasingly of demonstrate fees that an and reliability, customers of our and terms finalized dependability the mid-XXXX. growth B.C. long-term commitments a Lastly, signed volume Montney significant sees key producer be

secured the of as As Northeast be in Pembina of a expansion which rights executed forecasted future will B.C. that to Montney, commitments these this portion well the projects existing later efficient anticipated growth collectively utilization support have of a are executed into transportation year, the as improved expects to and long-term been result the have future. or capital to agreements significant assets

second The was important yesterday our to provide Pipeline on updates Peace announcement expansions. Phase

on secured enable service the mix clear result from visibility Northeast ethane-plus of Based in in a with the previously market leading and for be project, at pleased propane-plus at Phase confident for discussed, reactivating a delivery. the Montney incremental demand from producers, deferred Alberta, commitments the the as this other will into customers, conversation Phase As as commitments, the Gordondale, to segregated B.C. area And pipeline an is I Edmonton Pembina X NGL are Central area ongoing region. reactivate to X to the significant decision result, long-term time. have this for we we capacity which

into ahead $XXX expansion of X, Phase service June looking X schedule under are to placement expected and of We the on budget. forward also approximately million the

well, As fourth of project in-service expansion quarter of the updated we've that date XXXX. and of the X Phase construction to continues,

We portfolio with Rupert previously train customers also Terminal along current its advantage the announced a Rupert to Pembina's the at with diversified this of yesterday expansion that Terminal capabilities, of markets. Prince Prince unit Pembina will deferred time. not proceed provide

it market opportunities medium-term. high-value under strong development future to demand near enhance sources evaluate for to Pembina Pembina options will the prices continue meets customers evolve. sales and in propane the provide that domestic needs portfolio offering egress of the its believes propane as conditions new consider their WCSB, with expansion Given propane will can outlook within and a and

Canadian natural value announced increase venture of growth KKR, well for four which share gas Pembina and a Pembina new new together joint extension a Western KKR platform. The work we will single relationship, respective and this that desire the Midstream mutual we venture in invest is also processing Pembina capital returns. Veresen unlocks natural over generate calling a their currently partnered entity, and into has Newco. another of assets to We combine been During years. our are quarter, attractive formation joint for and

company exciting real opportunities. KKR wider to new and We creating commercial are drive a with extremely pleased of suite deliver this to be synergies

also this increase closing by to Pembina's pleased our month, upon dividend per transaction. of to common or share X.X% per $X.XXXX We were intention announce share

continue close work XXXX. to planning through quarter the We now of we regulatory associated the process transaction, approval and to this third the are transaction with for in

to tons XX COX allow front, of delighted and time a to sequester to project jointly one could Pembina be TC is On over transportation effectively is manage a Pembina emissions. Grid. the role the year Alberta-based sequestration develop helping in partnering system, This will ESG and Carbon grow per with carbon world-scale Alberta Energy to million play up industries to no vital

when capture government of Carbon has pleased utilization the were been we storage quarter, of first Grid Alberta the successfully chosen and to Province’s the stage Alberta next the announced the carbon move During to heartland. important We industrial hubs next stage look how the progressing over project few in forward carbon develop to process This years. to storage Northeast of this safely exploring includes the Edmonton. North and

to XX% year. recontracting. resulted XX% to seasons and continue year have offered in open in quarter during gas open for XXXX including first the market for seasons, contracted Alliance six have Recent we Finally, over the being next Alliance current of the the pipeline gas success

conduit the gas Over highly and of become US Alliances highlights as the has as and quarter. competitive Alliance and the call I past of discuss gas first robust will reliable to to recontracting the highlights a its liquefied in news to now detail success the value the to Gulf a Coast financial natural pass Cam market. Midwestern markets over more the year, access real good story

Cameron Goldade

Scott. Thanks,

record recorded in prior $X.XX the EBITDA Pembina noted, As a XX% quarterly of increase the billion, representing Scott a same adjusted over period year.

commodity on to the and to up lower results crude first derivatives by realized results crude oil XXXX oil NGL and seasonable sales contributions quarters stronger built where quarter margins increase prices, environment. market NGL, condensate, resulted, business. were from including on combined first Aux price were second margins for with The of and significant sold positively NGL when by was a inventory the of higher quarter losses in Improvements contributed higher during the impacted the during marketing, made Sable. higher commodity-related XXXX marketing due Contributions and marketing in higher third in

positive contracted a relative quarter a realized pipeline the and Dawson related pipeline, from in to from the development Rupert on general Pembina the an Nipisi oil first higher Horizon performance costs and Mitsue the due due representing price prior due stronger crude also Ruby higher in blending from systems offset from of well and period relative to larger on contribution as same project peers. environment. benefited earnings volumes volumes higher project, the system, higher Veresen addition, contribution volumes higher as marketing XXXX, to by at March share Pembina's the the lower Peace by partially assets. margins Pipeline prior the oil due were year. million, to service the contributions higher Adjusted Terminal to in due Pembina's and increase compared driven of largely on tolls higher rapidly incentives a administrative expiration and price These in lower into the to extensive Prince Midstream, rising Pipeline inflation, to in period EBITDA was costs in to and XX% long-term to In crude with the coming contracts, the combination XXXX a recoverable which recorded $XXX March Hythe increase entering factors slope service mitigation

commodity-related earnings tied factors and fees to gain on a by gas impacting lower derivatives higher AECO prices. EBITDA, the was addition for certain unrealized adjusted impairments processing impacted to In positively

oil approximately lower Pembina's to X% first release higher day to expirations by XXXX initial decrease raised range adjusted to due and of Total the into BOE of range divisions lower as The First higher in certain and Relative the service. previous guidance, tax compared realized reflects for of were hedging systems profit share new both Pipeline. its revenue by $X.X volumes and impacted from year. billion the offset by same billion. stronger billion offset period was pipelines quarter losses. crude revised assets per to result marketing on of third-party results, primarily quarter billion down from and the expense partially prices, earnings last outlook XXXX result million expected higher of in NGL EBITDA X.X contract were $X.XX volumes guidance and negatively a the yesterday, Pembina With volumes outages, income to facilities to a $X.XX higher the our placed $X.XX Ruby

XXXX. excludes impact expected and include operating from flow In of Chapter guidance is the the of not Ruby does Current dividends capital exceed XX activities from pending in outlook resolution process. revised addition, adjusted remainder the April Cash the XXXX, transaction. Pipeline investment X through from of Newco EBITDA the program the to

XXXX, disclosed, of the to in portion previously capital common the balance repayment of the the repurchases, now repurchased its $XX results by million additional or target. share towards financial expects shares Pembina XXXX allocate outlook is for has excess As debt. paying shareholders. Based down with Pembina and debt a available on distribution Pembina for profile XXXX, towards XXXX incremental the completed strong in strengthening December financial Including investment, to

relative of remarks. things necessary for are by debt back Forecasted the expected I'll closing targets now BBB to XXXX leverage Scott its to its to credit position turn levels rating. to favorably end strong preserve the stated over company

Scott Burrows

very asset well in we've Overall, contracting are our having Western the Basin future results for Canadian for intact projects we been past support discussions the utilization business capital-efficient that with translating as created is and to past expected conveyed This commitments and new accretive significant XXXX. will with potential the about now volumes. we into benefits the Sedimentary that higher We have as few over Pembina's and the today pleased regarding customers of the existing is Pembina optimism year and The for start long-term deliver remains of with and the Cam. to our quarters are positive future growth growing. success base over year and remain to the the strong prospects the Thanks, you confident message very stakeholders.

you things common virtual-only meeting today recommended again, audio of this before webcast lead Participants wrap General be XX time, want Annual presentation p.m. webcast. virtual I register that we minutes to the for Time. Once are that Meeting the its holding start Eastern will be X:XX Pembina X:XX a p.m. live time. year, up, remind Before will Mountain via at conducted to it shareholders

for Operator, virtual Pembina's the shareholder of Center www.pembina.com. again please page on AGM, information support. further the questions. would up For open like visit stakeholders closing, the Investor In at information our tab to their please we thank line under for once all

Operator

Certainly. Yeah. Instructions] first Tonet [Operator with And we'll question from Jeremy our take JPMorgan.

Jeremy Tonet

Good Hi. morning.

Scott Burrows

Jeremy. morning, Good

Jeremy Tonet

guidance year But is asking want baked refrain versus see that here, and raise you in want of uplift see I'll you I whole the in color improvement And to too? kind the or first from for increase do in was the the marketing, any way would did is just NewCo JV? Just NewCo from quarter just that the type annualized on there us the from uplift outperformance the be? to be kind uplift start-off XQ really here, -- this of JV, some were year if first factor base in business, give to What of would to what guide.

Scott Burrows

quarters recall, QX -- a in on and it's say of Jeremy, its Sure. biggest tends as you the combination have both, QX. I'd marketing to

lower our what's where on the range. the volumes So quarter typical a growing really of both through the driving then a QX, the is. sense the higher it's for best outlook of of have marketing combination increased on That's as marketing by throughout end guidance as end, well increase And getting we good system.

relates something depends that close it in on $XX probably of neighborhood some million it's the NewCo, when difficult million. in if to it because date But $XX time it's closing is. we As to forecast to QX, always

Jeremy Tonet

to million would $XX to or kind uplift, of $XX annualized the million of clarify? balance year for just the be an uplift the

Scott Burrows

For the the balance year. of

Jeremy Tonet

allocation bit And Got you. it. kind shifting Thank towards then gears of a capital strategy.

it. and a is a much new on since price. more projects remarks talked time about just than But wondering, call, CapEx, the last bit had last touched we've also share factors some coming expected. EBITDA you higher There's changed in -- You and back growth the there. higher

to this outlook for cadence and So factors regards just together the wondering come at how juncture? your that with these buybacks or you think in how mind about

Scott Burrows

Yeah.

$XX range in XXXX That's old you versus the the the for roughly guidance midpoint the million. in of see re-sanctioning expect midpoint of new VIII. think that's capital the we guidance increase about If of Phase the range, to

So in VIII. you the increase guidance Phase really think towards can about funding going

relates As around it capital allocation. to your question

our spend and plan the in are looking next would the saw what that remainder continued I the going say you of back would quarter, some we notes QX be As year. time we shares. yesterday, at to the buy over to for

you rightly gone point has our As price XX% out, from share to XX%.

to have X.X%, X%. Our gone XX-year X% yields from

attractive. from has perspective position growth, so but ourselves down debt, paying to And both for also economic an become more

no the we're right So spending but guidance something now, a change it thinking of is time lot to about.

Jeremy Tonet

Got thoughts a it. one, And last your outlook? on just Nation quick impacts that guidance First and thoughts or River have to you if Any and on general Blueberry I resolution how and -- situation in could. that

Scott Burrows

to talk the Sure. situation. on Janet to over I'm colleague, going to perspective it our my turn about

Janet Loduca

Nation. Good between coming communities, of Yes. been Jeremy, River hearing it's outcomes B.C. various morning, very discussions indigenous the First Janet. Blueberry positive and the the from We've government including

it say, looking closely forward months. to coming certainly timing, And so resolution, expect would to we It's that in we'll do and I the the watching some have we're anticipate difficult to but resolved. be

Scott Burrows

given Jeremy, entered Phase the producers, add, all the into, we've with we're to would I having us discussions gave VIII. just sanction that confidence arrangements

Jeremy Tonet

it. That's very leave Thanks. there. Got I'll it helpful.

Scott Burrows

Jeremy. Thanks,

Operator

now will Matt & Taylor Tudor, Pickering, take our next from Company We question with Holt

Matt Taylor

the on and you what's reach FID? existing plan then an given Yes. commercial update It of when Thanks, there. for us us Can and like give my taking I LNG. then terms on plans making looks you're to just you pricing and relationships for just new go obviously, in financing to to discussion, wanted guys good guidepost both progress going the customers with giving question. Cedar global the reach

Stu Taylor

very The our LNG lot customers and we've respect engineering commercial busy out to good conversations. the It's LNG I'll potential progress community from that's start. perspective. very has a market. had very, that to ESG very offtakers very positive the we've the very, from been talking And side commercial, with the from the there fact jump very Cedar has filing Stu. perspective, It's We're of itself, a we're I'll been on Cedar a conversations. response I'll With place talk to characteristics term a indigenous progress. side a will project. regarding in The The and today, year. positive. attractive it of consultation from to on to favorable going of these to about over what's the We're regulatory project and this applications. pricing perspective, working cost offtake sheets, take number making for very turn hard remainder of and conversations be to that Financing, Cam.

Cameron Goldade

Yes.

On options I a working solution. obviously, of most an I accretive at different our piece to it. We're Haisla side, think, stream. work Obviously, with big finance lot looking active the find that's we're the a partners, It's mean, there. the of

for timetable four-year ultimately, Pembina, think it, the Pembina which consider quite I the of for XX% table. And a is scale spend, manageable time ownership bite when you size. to it's over really a the and the

quite for the situation. and get their here, that over financing to we so a months them highest to FID, to definitely So few with obviously far. very come signals seeing positive with Pembina, some More closer next closely help potential working we're bite-size, as on but the

Matt Taylor

year, Yes. Thanks. next that still you're FID targeting? sometime what is

Cameron Goldade

following sometime We're shooting Yes. for QX.

Matt Taylor

pricing. Thanks part you sensitivities $X.XX Great. previously million for your was for disclosed that. $XX impact Awesome. move of remove that then every in And AECO

that business puts the just AECO might and through guess if I'm but run is pricing, and parts commentary of may you're in just what it higher although takes I So bit some of then negative on seeing factored into the if side, the wondering this offset. of a of marketing you the a could updated sort guidance your on be other

Scott Burrows

back correct spread. That being the high price AECO frac I said, of mean the Matt, putting year I'll the sorry, are Yes. definitely, in take of we you're pressure on XX% hedged. is -- half Jeremy, terms that.

And themselves XX% far on we prices on XX% always Likewise, of way AECO are we people on NGL propane too caution the side. side. because to on up, hedged input we're so get rising, the costs, hedged when the are ahead not the

running, more down very then rapidly returning XX% we're So to that then debt the got hedged, risen are our time, with of we obviously, seen updated did basis here that of the benefit been flip range. since the factor we've has a on to range. money the guidance extent has And still And AECO our but it's indirect that It we bit into side, comfortable community making come. AECO amount pretty is basis, hopefully the on a direct significant significantly. paying widen and drill producer and Chicago but to

upside differential. So as Sable from other in things contracts strong interest both we're with some are as that well at tied benefiting Alliance to Aux and that

of lots So, board, comfort in the takes of but our all puts range. it gives us across our terms and guidance

Matt Taylor

off. this wide for Thanks more, Alberta to moving if seats from I just benchmark. give just pricing global then LPG And that, finish you the on in elevated? back, with some us Can seems discount why compared say, canceled You've you we're historically the Scott. more may, color because the got one that expansion to US

propane? So your going more or infrastructure you can is update you're related of about strategy on how decision forward and a an us to required, scope and thinking this give

Scott Burrows

assess defer for term maybe I'm continue Yes, I'll Jaret, that to but that before just the clarify to need that I to We longer it. it and do, just canceled. wasn't going project turn over

do cancellations. I difference you want take that Jaret, to But between think deferral one? and So, continual there's a

Jaret Sprott

and morning, our like said domestically different propane our North in forward in this going -- providing United and we strong internationally, the domestically options And is and capacity the and pie best with opening as like outcome our the can to providing across export there, that slice America customers we customers of short-term. best here deliver Canada portfolio that's moving a capabilities, have sufficient have time, feel XX,XXX, of pricing and just at that with our train our Good just we unit for could obviously to marketing we remarks the in It's canceled. pennant destinations, potentially to if barrels the a -- going add, not Matt. it's range many It's Stu, looking here just drastically, Cam market continue ourselves that and very said, domestic change the to we're States. roughly the we and At conditions the Anything -- re-sanction. XX,XXX from evaluate wide diversification. Scott With of side?

Stu Taylor

of evaluate markets you've continuously very the think markets very covered portfolio We the have Jaret quite we believe American available the today. that North We we're us. I remain will markets it to We're -- said, with happy Jaret. well, are No, mix as in strong. that all the

things as and markets can right us allows we to capability, train described, comfortable access the well. the look sit time. we're to be very access believe choice today unit we with those Our that And think at here at and this markets as it we

markets stated, to the As can come the that and at move will in changes they make look we future, change as international if more available.

Matt Taylor

Great. Thanks for questions. a Guys, taking great have weekend. my

Scott Burrows

Matt. Thanks,

Operator

question Linda And Ezergailis we'll Securities. next TD with take from our

Linda Ezergailis

Thank you.

down expanding with type molecule, including the thinking involved us getting potentially petrochemical in table Just are how on moving your about just on you chain, you're on off based update provide Is the PDH. that on or with latest that? investments, What can the markets. comments, an value doing thoughts your more

Stu Taylor

evolving. IPL into to Obviously, always again. look. be we is I continue will that it's project. liked The coming Yes, project, the market Linda, service. mean Stu We've PDH the

along the as in As we'll think evaluate and that. think off sit to press for Pembina trying Pembina continue the role where provider. in we like available along what we're feedstock and petrochemical those we role provide a We like a markets continuing the opportunities on today, we'll a you us further provider here have to we've to the look space. and so, at that table in look feedstock, future. and We us, in of a plays. feedstock to moving do None basis. go-forward we evaluate on We Again, what potential We're provider look what present working as been describe opportunities major great the markets look move progress. being providing feedstock historically at play of to continue those described. further being down step plays are go-forward chains. We large value we'll themselves a best and to petchem with and at are we basis are completely of we projects to a and number

Linda Ezergailis

you. Thank And just the all given conversations another maybe the around in incumbency region. question your having, you're

Your producers, Are a they that on agreements the you all, any would to of other commitments Are What that sort your ensure are looking are passed seeing are discussions still Any with are through becoming helpful. acreage of negotiating? standard? customers? can How attributes color you're pressures commercial are at the those that? producers they inflationary be full preferring path? you to shifting, cost discussions you resisting if provide

Scott Burrows

take one? you like to Jaret, that would

Jaret Sprott

Yes. Linda. Thanks morning Good Scott.

I'll So, The there try into break to there, was a dedication. it so lot --. down area of

fractionation the with Chevron value up dedications and and our transportation, and through Harrison rail. In the they've start marketing Midstream that with Pembina's very So field-based and They gas also A the terminalling Duvernay calling chain. and lead own chosen do obviously, -- utilize little come customers most differently, processing their of take-or-pays, about services been they're some through customers the our choose talking build to CRP of once the we recently, to ones some that the and us, to similar. value like chain Conoco engaging on scenario, or and Keyera. with have dedication area bit

to our -- as I to customers. contracts contractual arrangements been us allows to customers' customers of with it's needs and our -- meet diversify inflation, grow, agreements continue it think with our we our our So that's always part our a we're

your that's those I I So And -- our are that answers agreements. in think, typically think question.

Linda Ezergailis

I'll queue. a back Thank Yeah. in jump you.

Jaret Sprott

Linda. Thanks,

Operator

now take our Scotia next question Rob Bank. Hope with We'll from

Rob Hope

could assets How A B.C.and them your region. Good looking the a follow-up the off guess draw to to secure additional capacity? does everyone. I given Saskatchewan guess, Northwest potentially field down to to in and morning from I that follow-up, are that to of need want some you port. region? Alberta question, for volumes further you frac as your about kind And continue additional in like when looks this pushed could into just doing Northeast And track prior thinking continue imply then, it you you some also move strategy be volumes the

Janet Loduca

Rob, Yeah, I'll jump getting you if But general, want that. to tight. comments. is please facility in, take pretty in our additional And Jaret, have fractionation

we're As look backfilling forward the to we contracts. future,

so talked working frac. have we about that we I. see that continues on kicked on and to it to and engineering the something It's And in but are to in an too that, talk the option the we given We've a RFS early past, we tightness off that timing about assess. be little probably that continue the on in background,

to In fracs, locate think still our I terms is in preference of field centrally Redwater.

as the well with it anything the still our low spot ideal the to Just propane online, that? sources Jaret, like the IPL/PDH you as think to with scale to capability, ability add train it's additional to make we have with methanol, there land, put with we unit coming want the

Jaret Sprott

adequate to cost your storage couldn't above that underground structure. -- hi increasing we salt would storage we Scott. you Well, the the Yeah. Further all have so, be obviously, to find extensively had just looked at, cavern field that, ground, fracs

of So I think for the frac pretty inefficient just rail storage. operation. and we've much eliminated provides field due lack of opportunity manifest an It to

for a the storage, out does Fort to continue the area. the port focus We'll access our of to feed storage It your vast tavern spec increase the intuitively, markets product look, will our cavern way area. customers. sense, due Edmonton into the our numerous long or rail due economies into going So sending to Saskatchewan to continuing which make infrastructure, netback to you're port of in although scale,

Rob Hope

And more, All right. one may. Thanks if for that. I

increased on what you you very, Can regarding key liquids side. well moving seeing are for Alberta, benefits and but just Northwest Northeast contracting offerings continue comment do are competition saying of to B.C. maybe out competition? customers the on very We the your versus

Jaret Sprott

Yeah.

obviously, number about in years for communities been has XX in organization Western the our service, one, So pipeline, in and Canada. our we're around

assets all into and/or and/or can our optimizes system, have the Edmonton, types now that way are out it are flow -- that stations assets like your segregated So through lowers VIII expanded will we're and have your Obviously, really system, and well-known to ultimately cost from in the of of product quickly fairly which service the some pump we that Gordondale things laterals patching communities, structure. be in takes service. Phase those

base only we customers down capital a over at very not very when operating cost also they the drive our work have volume asset, And at our look fee, customers. So do large every fee. day can hard to our but -- operating our you we for look the

think obviously, part is of connection -- customers And, in Saskatchewan area, our I around fracs only So sorry, into has of connection but pipeline all also competitors. -- system our not a the into ours it. and our our Fort that the

optionality. the to into customers our that places. We win but we lot our do Redwater So volumes customers like the go optionality for do facility, other provide a that of to

On the delivery into have points. connections condensate side, we condensate multiple

really package think it's that customers I the like. So the whole

Rob Hope

you. the Appreciate Thank color. right. All

Operator

from take now our with Catellier we'll Markets. next question Capital Robert And CIBC

Robert Catellier

morning, agreement. everyone. on the ConocoPhillips had just a I left couple good Hey, of questions

the at that additional risk? on to but will sounds that's lot be Phase in call with be there to way Is there's pays, But not Pembina look the leverage. it So they by some supported of infrastructure could as like bear capital, VII there it? or requirements it near-term, take there's the IX, a and CapEx like sounds that operating so enough capital to going

Scott Burrows

morning. Yeah. Good

that wouldn't would -- to think it as one of Pembina customer think deploy it require capital. of So as I sole

that our publicly question, in of about event their continue that -- think talked previous us per we I grow guess the we will have to just that in disclosed day all I success customers plans. one agreements previously as with the the

more to let's to deploy utilization, have will continue those and side our system. We volumes capital Alberta increase to of the it, capture the from call

also only I as be deployment closely going exciting. sure do significant LNG quarters So This of that me, NGLs VIII really the development then a into that profile. looking NGL customers coming will service, be from we there's call focused. working couple XXXX, and plans a that have here. growth will accommodate of -- capital very because will NGLs isn't questions with continue come. we in be can will after we our obviously, first there's frac ago, there the owners, their the more let's And condensate the few to evaluate be well is gas to make And to the coming It's capacity to pardon incremental think our half Phase at asset this with Canada it, -- then drive focus, to

that deploy think be and customers' meet it dynamic capital but to positioned So well will demands. and fluid, the we we're

Robert Catellier

require in, the some enough infrastructure in Fair we're into I supply to haven't a customers the the infrastructure. doesn't if environment make inflation. there's you Okay. rate given the that, the – to from multiple drive that a But there's aggregating years that road, protect four inflationary three want on you or walked Pembina, to just sure protection yourself from down

Scott Burrows

them. in inflators tools our was I have to TTI question. typically Great going Rob. say,

to So to we able free, that the tools. capital is cost that should extent our some in be recover there

Robert Catellier

Okay. Thank to liquids just fact That's market I then thought. question heard here, think confirm agreement? want in And associated there what you. to earlier, the response an Canada ConocoPhillips I I something opportunity next in but with I the the is

Scott Burrows

question? you Can the repeat

Robert Catellier

you liquids Yeah. are I have Conoco market associated confirm want to to agreement? the with that just the an you – do opportunity

Scott Burrows

correct. That's

Robert Catellier

me. one Last Okay. for

over You've made couple of some the Alliance quarters here with progress last contracting.

some terms XXXX for? immediately the be given You've you provide except if color commercially of pretty I'm sensible that's that much – of beyond wondering us might not in but for next the good to years, can couple you visibility contracted how

Scott Burrows

We actually longer today, term. have ongoing closes that open for an Rob, season

update next we're but to period in time of bit quarter, be sensitive we'll a a commercially right a position that, maybe in so And now.

So I'd for that pipeline not answer now prefer to other right robust. that than demand the is to say question

Robert Catellier

Okay. Thanks everyone.

Operator

BMO. And take Ben our question next from we'll with Pham

Ben Pham

attractive? on in things are side the to that's terms transfer perhaps PDH like you for and speak back have customers what's popping where your Hi. shipping on the of Thanks. reevaluated to most morning. of I your Prince of Good decision netbacks wanted go this. Is costs the I is Prince mean, to Rupert? expectation Rupert netbacks gone What propane or producers it and swap up. it the going

Stu Taylor

PDH really now, yet. Stu. Ben, winter. it's rising running out capability shipping service, in success this the markets. We've at into into our seen there. looking our product the past mean, We've I market great our of to US coming up some of as enjoyed facility Right well. of get and all not had we're Sarnia We've prices in deliveries as is that's

been the We've like that been We in today, we sitting pay for good market, market. the that see in particular, market over pricing. historic a we're long And like it's rises have. Sarnia seen a us We we term. The and where so continuing. the balance that's

of the So markets rising we at. where but you've of hinted costs do we're stated look and couple or move, things, and all shipping our a netbacks at

So available believe we markets. point this our we're to And We markets continue time, served including the markets the are to capable markets. to opening cost such look those evaluate us of at that feed to are best that as America, ship to PDH. up we and look as accessing in I facilities in and North at the today

at a change. So basis, does the is dynamic on we pricing look as it but go-forward it

Ben Pham

with And is in store? Prince planning it? like it I mean, to that expand, Rupert to if Pembina Is how it is you near planned important not are term. you the aren't the to you need facility Do expand

Scott Burrows

barrels the our almost to international as you We -- XX,XXX value Well, When markets. We're are and move day. customers as I shipped that to diversification with currently railcars, loaded into barrels, accessing a -- those coast. can it's say and barrels it we ourselves. shipping to mean, believe provides far need, we're

fit. overcapitalize. valuable we time, We right those around the it's get. that -- that We see receive We given Prince to how basis. customers such we expanding at want the over opportunity the the netback move like to really have see dynamics go-forward will the that make asset to I that the the sure they we and America access at But of don't think Rupert North in best producers can right ensure still we like that front like store, Pembina on markets today, a is our want it be to we and long something as And now. us Terminal. the barrels it market size that we haul we We our at a we're continue to can look

Ben Pham

terms Okay. Great. on of side update any things? my last in And one of CFO the timing is

Scott Burrows

immediate I'll QX QX, hope would in that take in I actively year. process that the this and to one. we're mean, No conclude timing.

Ben Pham

Thanks, everybody. great. That's Okay.

Operator

question And RBC from our next Kwan Capital we'll Markets. Robert take with

Robert Kwan

specifically, any morning. come Good lot I dedication? factoring Great. to area coming But on components back If volumes base I make take-or-pay Conoco a know can the of out agreement, I'm the it. I are there there's questions been of sure

Jaret Sprott

Robert. Good morning,

Robert Kwan

you are Jaret, there?

Jaret Sprott

Yes.

Sorry, bad the hearing right a just having I'm time was hard question now, connection.

Robert Kwan

Yes.

Jaret Sprott

Go ahead.

Robert Kwan

an you area Jared, dedication. described it of as

there into just the I'm basis as are wondering, base would take-or-pay So an come of part components any the annual basis that over on a or multi-year volume whether deal? out

Jaret Sprott

would be, there Yes, Robert.

Robert Kwan

be And roughly of structure "typical" it your would roughly less? kind approximate would take-or-pay or something of they XX%

Jaret Sprott

contracting our in be strategy. No, they typical line would with

Robert Kwan

something That's Okay. then. a great. just philosophical I little can ask If more

most entering you you one, the of You them but a are new of joint bunch a of ventures, although, were operator. these, and have number into are a inherited,

diversify we'll you Do and count. something company? attractive So to grow ventures business, want grow you your additional share being just mindful as as the joint the -- see of be to

Jaret Sprott

and we stuff especially and and team energies his transition I as lot move new a Robert, Stu working of think are the into so, on. energy

to are a certain don't our necessarily areas as have the to but we bring relates the same there experience we partners area. table, potential it know, as some lot that where You of

to in I say are area, would specifically be ventures where that intriguing us. area So ventures would joint new the the

Robert Kwan

are point are way that? of where a them the vast ventures, mitigates just if especially, And just joint majority proportionate many do you of feel just you philosophically, or operated that comfortable, report numbers you too you type and there get to the are if a lot

Scott Burrows

my Well, leverage great from there philosophically, a I move skill to are to way perspective, think, sets different forward. that

joint if like from do I joint perspective, of In said I of clarity into investors there's from leverage number is number but well sat proportionally we've I do what our to don't we give an demystify a what ventures. terms down EBITDA ventures, it on and of a looks mean, think basis, hard to tried it our as and for always fast consolidated know to try investors. and a as perspective both

number disclosure gets too ventures Investor we joint So I'm our what of I have. Relations think they then investors as long as the not about need, worried

Robert Kwan

whether -- orward see the projects out. Nipisi other with as just relates seeking of back think Got contracted other contracts just to were just the with some just was fanfare -- lot period? just the takeaways into it. and a If how when for I you returns plays Mitsue higher these there Are repurposed, step played during to? go runoff. can Are cash-on-cash of There any longer-term built, opportunities? there they or a and as you maybe that contracts projects you any kind additional Do on finish extend taking

Scott Burrows

that and but that active now. say plays, on area, that there opportunities surrounding about Clearwater the pipeline, particular in the we I would that discussions, for can we're say think all given that's in seeing the some and growth we're in is right I

Robert Kwan

you how that question contracting a projects you of quite... just other Just And given Okay. forward? how that's about greater think go

Scott Burrows

Well, I that, recall that on mean, you -- a that if was XX-year contract.

it's always we'd a like longer, customers. with course, Of constant negotiation but our

the have to extent contracts, something we would I longer get So were think, that's to able we pursued.

perspective the more going from on think I the that say there's pipeline, in to to months that of here. be coming

Robert Kwan

great. Okay. much. That’s very Thanks

Operator

next Credit Suisse. from We'll take question our Kuske Andrew with

Andrew Kuske

competition? basin, of really do of where the a And areas liquids have how really other There's for in egress where pockets? the different then the then natural facing may outlook in And that about gamut Maybe congestion big crude you gas, do certain across points capacity? of things. and your own morning. in and NGLs stuff? picture a So system, covers be question bunch do Good you just you think have Thanks. you excess

Scott Burrows

for but mean, already. I up up filling macroly, I'll try to on obviously, step if that's was add back full I if basin, not X coming Line that. the it like and sounds very think expansion a helpful

on come to egress. service egress as really as rail relates and TMX for patiently into not add waiting all out crude we're just to factor solely incremental unlock basin it that think and to the swing I a of rely So

future specifically asset Pembina. is obviously TMX have From it the capacity for to areas basin. there's gas of the relates perspective, as a So pretty a still multiple important that

expect look we've to starting trying As expansion pipeline full, on highlight we very is to might to here, think about well. like where been to we're what time getting a and full period point to as for of that Alliance the be an

unit As well of you're it relates to as that NGLs, trains, aware. on out most moved

in the a have PDH. our coming in talked are fourth. I tightness some with of the it capacity conventional month seeing there's end year call, a also tightness on as IPL's earlier we We Phase frac X in And X, about But our relates as new in here, to pipeline X on we at and conference then Phase online just this source the comes Obviously, system, today. re-sanctioned. Phase comes then

with are to low-cost customers. capacity. to that continue to capacity constrained. expansions our currently debottlenecking the come that, some station those on, the we're pump Once be So parts will forecasted of have some And after system we grow or

Andrew Kuske

some you maybe helpful. as about start guess intentions stuff coming that of expensive frac producer on you footprint be sort guess the just plays really side, maybe the characterization? then biggest then very developing into the to do increase most low-cost I the And a from outlined your And expansions would you've activity, would that existing to That's I the benefit think that of thing down pipeline. is and and fair

Scott Burrows

been is really place. ancillary able of and But with the amount, business lot already in facility fair. our existing in the is a the footprint we've investment caverns The rail. itself invest historically, with It to on and

a attractive it's perspective, opportunity. very our from So expansion

Andrew Kuske

franchise positioning? ahead, the goes the the frac multiplier effect across your let's assume just even a multiplier you maybe the effect would or across given expect same So franchise better

Scott Burrows

Correct.

Andrew Kuske

you. Thank great. That's Okay.

Operator

now Weekes our Markets. We from iA question take will Capital Matthew next with

Matthew Weekes

taking Good Thank my for question. you morning.

Difficulty] [Technical Just question.

Just on could fixed, just we're wondering rates protect debt or the the you against you that much interest is maybe the if sensitivity to looking you at of on environment and like in terms that rates? what the in. maybe comment I swaps how the rising rising debt is rate interest rate interest have was that of profile maturity

Cameron Goldade

Hey, Matthew, it's Yeah. Cam.

done fixed-rate for approach time of So maintain debt. high a proportion clearly programmatic some to really we've a very

the of the today, stand of at $XX.X you of of excess XX% the corporate fixed debt tenor XX if floating there. that It's JVs, sort years. with in there's we of rate look closer sort look we almost the as which to debt XX% debt at profile, Pembina about that that bit you is roll When rate billion, average up a is is So And actually. today. more little

into some portfolio. that have to hedges introduce managed We

of So rolling proportionate debt our in the that just up were totality of total under fixed tune to debt. XX% rate

again, So refinancing we've our at really to really of got When really ladder protection. look debt portfolio. maintain to sort stable a we a tried lot we've rate the risk, interest of

we've we've the term or around bilateral about one million that so bonds $XXX year, the of second of got which and due loan, half this in loan, come due So just comes got a year. term

refinancing. of now. flow that. prefs our handle remains They an at in reset. right towards considerable at tail in cash Scott got resets we've manageable mean, in alternatives be capital and obviously Obviously, couple maturities That the really, redeemed. be we're the generating comments, again, last And hybrids. hybrid piece and that. structure always obviously, capital end of of a we'll got They year. I so is, portion looking as obviously we've we'll terms can upcoming this The at a to very option And comment allocation the mentioned those. the considerable coming and And are free looking be of various But his I'd the looking between

the time looking so we there And at that. we'll line closer a bit the approach as get optimal be to for

Matthew Weekes

you spending for opportunities transition on And amount debt sort forward follow-up and how like up Do could question greater opportunities a sort access? this green take any financing Okay. of and projects of any forward. energy a see thinking just of the going going about

Scott Burrows

or sustainability The us something is we're products something step linked number piece that probably loan spending related is the of tack market there's on. once to something that tune a down, [ph] on think loans, of of It's green And we're definitely alternatives spending a even bonds. some the time framework I specific potentially a looking for in sustainability-linked the time the we've other bond some start got project. those first to Obviously, at some on. SLB we'll

mature, certainly continue of. to these opportunities it's look something advantage at And looking we'll scale as something at. definitely So we're in the

Matthew Weekes

back. answer great Have Okay. on I the turn a I'll it weekend. appreciate that.

Operator

Kenny with We'll now National question Patrick Financial. take Bank another from

Patrick Kenny

morning, good Hi, everybody.

the up oil project. on other of there's Perhaps you Alberta through supply region. clarify potential the the to liking Any group, sands. stage your Cold any in can into work move if Just to the grid, update carbon help the alongside partners on to as Pathways the the firm design you link to namely from need Lake just sources, bring ACG

little in financial Just participate some or of thinking given flexibility the your XX.X% overbuild ITC, not sure project the if even gives the that of scope the capture with you to customers? a more bit investment maybe perhaps opportunities

Stu Taylor

we was the of sequestration that -- process industrial some first in capture we I'll the heartland. the government Stu. with -- part of process it's speak carbon to. as the We're or the Pat, try

the of TC emissions entail. We're with And heartland. partner, the of were hard so building out working that we scope come opportunities what from will parties project sequestration selected one to for with the industrial forward our Energy,

our go heartland sorry. on forward. we're on as Alberta more we we And partners, and to government continue our We of clarity process within at the the the scope, are the will working -- our customer some customers, outreach And looking who communications. will with and ultimately matters working on industrial we're their waiting become work

evaluation they People evaluate outside government well. you heartland as all sequestration submit and described, As sites. closed sequestration submission We second a emissions, that for for you out your move of agreements, The in acreage a the outside up negotiate, areas. of a did recently other industrial to will What industrial the participated just then process. the as heartland. capability proposed ultimately permit come with which prove

at for believe this and as an customers in and with players there working and other look and look industry space. to continue is We partners together room

We partner have in at in opportunity the projects our been the the that that there others, The and new this freedom. lot are had indigenous bit is transmission project ongoing. looking far and space. more with time. pathways, We've this are side. own scope. variety to equation. communities their players now of and other point, the believe at government a progressing the got at this to could technologies as do People emitters, side producers, be credit, sequestration at I other as in to with tax as a conversations give point it's such those does the that's a future do, not, used announced, sequestration of But We stuck We've looked capture existing

progressed into haven't that So we too side. far capture

I else, think that Pat. everything if answers

Patrick Kenny

bring as Midwest, you a switching mentioned, the that's could heightened demand given of into It an a connection to Alliance to end M&A here, you you. securing longer perhaps just guess, us does. as here for I the what Yeah, perspective, great downstream the vision to the or conduit that color. Alliance for Thank game Gulf. needs offtake frame from maybe And meaningful and to again, together towards LNG into egress as Chicago BD over reality. term, longer-term a come Perhaps help

Cameron Goldade

M&A the take part, Pat. I'll Yes.

are right producers and are able doing do perspective, now our from that contractually to it. think I

going together. link we it things for today happen, the two capacity securing are LNG So, incremental see Gulf I the we need think and don't to We're of Coast to think people happen, sort outlook LNG. those acquisition to of as seeing continue long-term and any out it's to especially

to assets. Gulf incremental Coast the without provide conduit own I So having to Midwest able we're think LNG and that ultimately, into

Patrick Kenny

the question That's what Okay. just Ruby last of can not here. impact contributions guidance a from And EBITDA had year? I'm cleanup on or the quantify range your you for EBITDA the comment then, revised helpful. sure offsetting removing if

Scott Burrows

to to not not specifics. that and were gives there get many so Yeah, going -- takes went into going Pat, into We're it. we're

Patrick Kenny

I’ll leave No, guys. it Thanks, fair enough. there.

Scott Burrows

Thanks, Pat.

Operator

telephone for There questions. turn are over back remarks. Burrows to to Mr. or closing the conference I'd like further any additional no

Scott Burrows

AGM to to story. Well, and a with hope you you our our have in see afternoon. really If listening virtually We great thanks, pleased this our appreciate We're everybody. weekend. at results dialing not, and

Operator

your you again, today's thank all does participation. And for once that conclude conference. We

may You disconnect. now

Pembina Pipeline (PBA) 6 May 222022 Q1 Earnings call transcript