DT Midstream, Inc.

Welcome to the DT Midstream Second Quarter 2023 Earnings Call. I will now turn it over to our speaker today, Todd Lorman, Director of Investor Relations. Please go ahead.

Good morning and welcome, everyone. Before we get started, I would like to remind you to read the Safe Harbor Statement on page two of the presentation, including the reference to forward-looking statements. Our presentation also includes references to non-GAAP financial measures. Please refer to the Reconciliations to GAAP containing the appendix. Joining me this morning are David Slater, President and CEO, and Jeff Jewell, Executive Vice President and CFO. I'll now turn it over to David to start the call.

Thanks, Todd, and good morning, everyone, and thank you for joining. During today's call, I'll touch on our financial results and provide an update on our growth projects, including our CCS project in Louisiana. I'll then close with some commentary on the current market fundamentals before turning it over to Jeff to review our financial performance. So with that, we had another strong quarter and the business continues to perform in line with our full year plan, giving us confidence in our full year adjusted EBITDA guidance for 2023, and early outlook for 2024. As a reminder, we expect growth to be weighted towards the second half of the year as we bring new projects online. I am very excited to announce that we made a final investment decision on a new greenfield gathering opportunity in the Ohio Utica. This opportunity originated from an acreage dedication we held with a small private producer. That acreage has since been acquired by a large-cap investment-grade producer who is committed to developing this area. This opportunity has always been in our plan for 2024, and now with the development schedule finalized and a restructured commercial agreement in place, we are shifting approximately $100 million of committed capital forward a few months from early 2024 into the second half of 2023. The initial backbone build out of this natural gas gathering system will provide over 200 million cubic feet a day of capacity and go into service in the first half of 2024. The gathering system will transport associated gas from new wells being drilled in the rich window of the Utica. These wells are highly economic under current market prices, and our investment is underpinned by a long-term contract with minimum volume commitments that fully protect project returns. As is typical with any new resource development, there will be a production ramp up expected to occur over an 18 to 24 month time period as the acreage is delineated. As such, we don't expect a meaningful EBITDA contribution until 2025. Longer term, we expect a larger scale build out across a customer's sizable acreage position as well as future integration with their downstream assets, such as Nexus. So, in summary, this opportunity checks all the boxes for DTM. Accretive organic growth, highly economic resource, long-term contract with MVCs, strong producer that diversifies our customer mix, and significant follow-on opportunities for existing assets. In our emerging energy transition platform, we continue to progress our CCS opportunity in Louisiana. Our initial 3D seismic survey data indicates the geology we are targeting is favorable for permanent CO2 sequestration. During the quarter, we filed our Class V characterization well permit application, which we expect to drill in the fourth quarter of this year. We plan to spend approximately $15 million this year for these activities. Assuming the characterization well results are favorable, we would then plan to FID the project in the first half of 2024. Overall, we continue to make great progress advancing organic opportunities across our portfolio in both our conventional business lines and our emerging energy transition business platform. Turning now to our projects currently under construction, I am happy to report that all projects remain on budget and on schedule. We have made excellent progress on our LEAP phase one expansion, and I'd like to acknowledge and thank our dedicated team in Louisiana for doing exceptional work on this project. Pipeline expansion is currently running ahead of schedule, and we expect an early Q4 2023 in service date, with the potential to pull that forward into late Q3 if we maintain our current pace. Finally, I wanted to take a moment to address the natural gas market fundamentals and producer activity across our assets. We are observing moderating production levels and some short-term deferral of activity in both basins as producers continue to operate in a disciplined manner given the near-term weak prices. This is all fully reflected in our guidance. On a positive note, over the past few weeks, we have seen rig reductions stabilize. With extreme hot weather occurring across large portions of the country, this is driving strong power demand for natural gas. LNG fee gas deliveries have returned to high levels following summer maintenance. And all of this is beginning to reduce the current storage surplus that has created the near-term price weakness, resulting in some price improvements. Four gas prices look favorable in 2024 and 2025. in the $3.50 to $4.00 range as the market anticipates the next wave of LNG demand. Our assets are well positioned to participate in this growth. I'll now pass it over to Jeff to walk you through our quarterly financials and outlook.