Enterprise Products Partners L.P.

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

Thank you, Norma. And good morning, everyone, and welcome to the Enterprise Products Conference call today to discuss second 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. 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 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 or list of factors that may cause actual results to differ materially from those in the forward-looking statements that may join the call today. And so with that, I'll turn it over to Jim.

Thank you, Randy. Today we reported adjusted EBITDA at $2.2 billion for the second quarter of 23 compared to $2.4 for the second quarter of 22 and $2.3 for the first quarter of 23. We generated $1.7 billion of DCF, providing 1.6 times coverage Enterprise retained $639 million of DCF in the second quarter, and we've retained $1.5 billion year-to-date. We had resilient financial results despite the impact of lower prices for crude, natural gas, NGOs, and petrochemicals. Our profits were negatively impacted by weaker processing margins for the first part of the year. Our petrochemical service segment continued to perform in spite of the low price and lower margin environment. During the quarter, we established six operational records, including our natural gas pipeline volumes, NGL fractionation volumes, and 11.9 million barrels of oil equivalent of total pipeline volumes. We're also extremely proud of the fact that with the increase in our distribution last quarter, we crossed the threshold of 25 consecutive years of distribution growth, literally unheard of in the midstream industry. This is truly an exceptional milestone across all industries, and most importantly, a real tribute to the core principles laid out from our very beginnings that RANDA continues to prioritize today. Moving to growth capital, we started the second quarter with $6.1 billion of major growth projects under construction. We have since completed construction on four major growth projects that will provide new sources of cash. We have an additional $4.1 billion under construction. Completed major projects during the second quarter and early July include a 400 million cubic foot a day expansion of the Hainesville extension of the Acadian natural gas pipeline system, which is sold out. Our Poseidon cryogenic natural gas processing plant, which is our sixth processing plant in the Midland Basin, which is sold out. Our 19th NGL fractionator, which is sold out, and our PDEH2 plant in Chambers County, which is sold out and ramping up currently between 65% and 70% and climbing. The three remaining natural gas processing plants we have under construction in the Permian Basin will go into service in late 23 and early 24, one in Midland and one in Delaware. And the first phase of the Texas Western Products Pipeline will be put into service in December. When we complete the next three Permian plants, we'll have 16 processing plants in the Permian with the capability to process 3.8 BCF a day of natural gas and extract more than 520,000 barrels a day of NGLs, all destined for additional value-added services in our Gulf Coast NGL system. Meanwhile, downstream of the Permian, we have major expansions underway for ethane, ethylene, polymer grade propylene, and LPG, expanding and upgrading our export capacity at the ship channel at Morgan's Point and at Beaumont. Our new export projects are designed with an emphasis on flexibility and reliability, centered around a highly integrated footprint with multi-product capabilities. Even as the world works its way through a significant petrochemical downturn, U.S. NGOs and opens continue to get a lot of attention from petrochemicals focused on feedstock diversity and advantage prices. In addition to multiple long-term export contracts we recently signed, we are also in discussions with counterparties from several countries for substantial amounts of additional natural gas liquids and olefin exports. This level of customer interest is what supports further expansion of our export capabilities. A wide gas to crude spread gives the petrochemical industry a feedstock advantage that is proving both durable and permanent. As Randy's heard me say a million times, I grew up in that business, and I've lived through more than a few cycles. Only the strong prosper through times like these, and U.S. NGL feedstocks sourced from shale oil and gas are again proving their growing importance. The durability of U.S. shales is evident in ever-increasing U.S. exports of crude, natural gas, natural gas liquids, and in exports of petrochemicals in various forms. In July, enterprise crude oil exports will exceed a record 30 million barrels. Oil and gas has faced commodity price headwinds, especially compared to the premiums of last year, when crude averaged over $100 a barrel during the first six months of 2022. We see no reason that crude should have been trading at the low levels of the last few months. In early June, OPEC Plus announced they were extending their reductions into 2024. On top of that, the Saudis announced they would unilaterally cut an additional 1 million barrels a day of production in July and August with the option to extend these cuts as needed. Meanwhile, waterborne data confirms that Russia's exports are coming down. Inventories of crude and refined products, both in the U.S. and globally, remain very low. while OPEC Plus continues to demonstrate they are committed to price stability. Even though industrial demand continues to lag, consumer demand is strong, especially in developed nations. Good oil supply demand fundamentals continue to indicate that we're in store for much tighter balances for the remainder of the year and in 2024. And with that, I turn it over to Randy.