Enterprise Products Partners L.P.

Good day and thank you for standing by. Welcome to the Q1 2023 Enterprise Products Partners LP Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Randy Burkhalter, VP of Investor Relations. Please go ahead.

Thank you, Gigi, and welcome, everyone. Good morning, and welcome to the Enterprise Products Partners conference call to discuss first quarter earnings. Our speakers today will be Co-Chief Executive Officers of Enterprises General Partner Jim Teague and Randy Fowler. Other members of our senior management team are also in attendance for the call today. During this call, we will make forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934 based on the beliefs of the company as well as assumptions made by and information currently available to the enterprise's management team. Although management believes that the expectations reflected in such forward-looking statements are reasonable, It can give no assurance that such expectations will prove to be correct. Please refer to our latest filings with the SEC for a list of factors that may cause actual results to differ materially from those in the forward-looking statements made during this call. And so with that, I'll turn the call over to Jim.

Thank you, Randy. Today, we announced Enterprise off to another good start for the year. We reported a adjusted EBITDA of $2.3 billion for the first quarter of 2013. We generated $1.9 billion of distributable cash flow, providing 1.8 times coverage. We retained $863 million of DCF for the first quarter. We reported seven operating records and one financial record in the quarter, mostly related to our pipeline activities and export volumes across multiple commodities. We had record pipeline and fee-based natural gas processing volumes, record NGL marine terminal volumes, and near record total marine terminal volumes. In March alone, our marine terminals loaded over 70 million barrels of NGLs, crude oil, refined products, and petrochemicals for export. Our NGL and natural gas pipeline businesses as well as our natural gas marketing and octane enhancement activities also reported strong increases in gross operating margin compared to the first quarter last year. We also saw strong margins in our refined products business, offset by lower volumes in our propylene business, where PDH1 was down for 24 days during the first quarter for planned maintenance. We remain on schedule to put approximately $3.8 billion of major projects in service this year. In the second quarter, we will commission PDH-2 and the expansion of the Acadian gas pipeline system. In the second half of the year, we will complete our 19th NGL fractionator, two natural gas processing plants, and the Permian, and put the first phase of the Texas Western Products Pipeline in service. We are running essentially full across all our assets with the exception of the Rockies. We have significant expansions in our ethane, ethylene, propylene, and LPG systems. We are upgrading export capacity and adding geographic diversity to our ethane export assets with positions at Morgan's Point and now Beaumont and expanding our LPG and propylene capacity at our Houston Ship Channel facility. Our ethylene export facility has been full since day one, and we're expanding that by 50%. Ethane exports have moved from being only consumed by a handful of niche players and point-to-point movements to significant growth in demand by several petrochemicals in Asia, Europe, and the Americas. We recently completed new ethane export contracts that add 240,000 barrels a day with multiple counterparties. On spot, we received our record of decision this past November and expect to get other permits and our license in the second half of the year. We are way ahead of other applicants, and we know what it takes. to get a record of decision. Two buoys and a motorboat to hook up to a ship won't cut it. We will have a 24-7 manned platform, fiber combustion, and two pipelines that provide the ability to load multiple grades of crude oil and also able to evacuate those lines during hurricanes. Time is on our side as we commercialize this project because we don't think it's needed until 2027. While the second quarter can be our weakest seasonally, we remain constructive on global market fundamentals, even though the forward curve doesn't reflect that. In addition to low global inventories, we also note that OPEC Plus seems to be intent on managing global balances. On the demand side, expectations for most consultants range from 1.4% to 2 million barrels a day for global demand growth in 2023. OPEC Plus economists say they are standing by their forecast of 2.3 million barrels a day demand growth by the end of 2023. From our perspective, that sounds rich, although the last five weeks, U.S. crude inventories have drawn 20 million barrels. Countering these bullish fundamentals are concerns about the global economies the central banks continuing to signal additional rate increases to tame inflation. Meanwhile, while the Chinese continue to ramp up travel in a huge way, their industrial manufacturing surprised to the downside when their PMI turned negative yesterday. Regardless of the near-term mixed signals, which continue to signal a range-bound market near-term for us, It's very hard to make a bearish call for oil in the medium to long term. And it's hard for us to be too constructive on natural gas. A wide gas to crude spread gives U.S. petrochemicals a structural feedstock advantage that in our view is permanent. Case in point is the current operating environment where the U.S. ethylene industry is the only region that has been consistently profitable while the rest of the world have been very selective in what they crack and how they operate. Single-use plastics are doing good. They're profitable, while durables have their challenges and their headwinds. Meanwhile, the U.S. refining industry is one of the most competitive and technologically capable in the world. In short, we expect U.S. production to continue to grow We expect demand at our docks will likewise continue to grow. If you want to know where we're going, look at what we're doing. We continue to expand our ability to export hydrocarbons out of the U.S. to points all over the world where it's needed. With that, I'll turn it over to Randy.