Marathon Petroleum Corporation

Welcome to the MPLX Second Quarter 2023 Earnings Call. My name is Sheila and I will be your operator for today's call. At this time all participants are in a listen only mode. Later we will conduct a question and answer session. Press Star 1 on your touch tone phone to enter the queue. Please note that this conference is being recorded. I will now turn the call over to Christina Kazarian. Christina you may begin.

Good morning and welcome to the MPLX second quarter 2023 earnings conference call. The slides that accompany this call can be found on our website at MPLX.com under the investor tab. Joining me on the call today are Mike Hennigan, chairman and CEO, John Quaid, CFO, and other members of the executive team. We invite you to read the safe harbor statements and non-gap disclaimer on slide two. It's a reminder that we will be making forward-looking statements during the call and during the question and answer session that follows. actual results may differ materially from what we expect today. Factors that could cause actual results to differ are included there as well as our filings with the SEC. With that, I'll turn the call over to Mike.

Thanks, Christina. Good morning, and thank you for joining our call. Earlier today, we reported second quarter results. Our business delivered adjusted EBITDA of $1.5 billion, an increase of 5% year over year, and a new quarterly record. Distributable cash flow of $1.3 billion was up 6% versus the second quarter of last year and was also a new record. We continue to see strength in our base business and contributions from our growth capital investments, driving DCF for the first half of the year up 6% as compared to last year. We also remain focused on return of capital. We continue to expect our distribution to be the primary return of capital tool supplement it with opportunistic repurchases. Based on the strength of the business and our balance sheet, we're well positioned to continue to optimize return of capital. While natural gas and NGL prices are lower than last year, our long-term production outlook for our GMP producer customers in our key basins remains largely unchanged. In our largest basin, the Marcellus, the cost to develop remains at a low end of the cost curve and still below current commodity prices, and we expect to see maintenance level drilling activity continue. The recent U.S. Supreme Court decision to allow the MVP pipeline construction to continue is supportive for natural gas development in the region. In the Permian, our production outlook is unchanged as crude prices remain strong and prices for associated gas do not significantly impact producer activity. Our integrated footprints in these resilient basins position the partnership with a steady source of earnings and growth opportunities. This quarter, we advanced our natural gas and NGL value change strategies with the announcement of new projects in the Permian. We remain confident in our ability to grow and are focused on executing the strategic priorities of strict capital discipline, fostering a low-cost culture, and optimizing our asset portfolio all of which are foundational to the continued growth of MPLX's cash flows. We continue to enhance our ESG commitments and disclosures with the publication of both our annual sustainability and perspectives on climate-related scenario reports. We continue to make progress on our 2030 target to reduce midstream methane emissions intensity 75 percent from 2016 levels. Through our focus on methane program, we have implemented measures that have achieved approximately 10,000 tons per year of methane emissions reduction. We also continue progressing our biodiversity target to apply sustainable landscapes to 10,000 acres of pipeline right-of-ways by the end of 2025. Through last year, we've achieved over 10 percent of this target. NPLX is also participating in alliances focused on CCUS and hydrogen hubs. we will continue to evaluate low-carbon opportunities where we can leverage technologies that are complementary with our asset footprint and expertise. We continue to challenge ourselves to lead in sustainable energy by meeting the needs of today while investing in an energy-diverse future that creates shared value for all our stakeholders. Now let me turn the call over to John to discuss our growth as well as our operational and financial results for the quarter.

Thanks, Mike. As Mike referenced in his remarks, MPLX has a strong history of successfully executing the strategic priorities of strict capital discipline, fostering a low-cost culture, and optimizing our asset portfolio, all of which are foundational to the growth of MPLX's cash flows. And through the first half of this year, distributable cash flow has grown 6% year over year. Looking back over the last three years, as you can see on slide five, Our growth is not linear, but instead tends to come in stair steps as we develop and bring projects online. For 2023, our capital program outlook remains at $950 million, including $800 million of growth capital and $150 million of maintenance capital. In the L&S segment, our joint venture projects in the Permian are progressing. We see strong demand for the Whistler natural gas pipeline and its expansion to 2.5 billion cubic feet per day, which remains on schedule for completion in September. We're also planning to expand the Bengal Joint Venture Pipeline to 200,000 barrels per day as we look to grow our participation in the NGL value chain. The capital-efficient expansion of this long-haul pipeline is supported by existing and growing demand for NGL takeaway from the Permian's Delaware and Midland Basins to the Fractionation Hub in Sweeney, Texas. We expect the expansion to be completed in the first half of 2025. On the Wink the Webster crude pipeline, we expect volumes to ramp this year and over the next two years as the pipeline continues to place segments in service. And as a reminder, these three projects, Whistler, Bangle, and Wink the Webster, are largely financed at the JV level, and therefore, our portion of the debt finance capital spending is not reflected in our capital outlook. In the GMP segment, we remain focused on growth investments in the Permian and Marcellus basins in response to producer demand. In the Permian's Delaware basin, we continue to bring online new gas processing plants to meet increasing customer demand while targeting strong returns with strict capital discipline. Our Tornado 2 processing plant began service at the end of last year, and we are advancing construction of Preakness 2, which we expect to be online in the first half of 2024. We recently approved plans to build our seventh gas processing plant in the basin, Secretariat, which is expected online in the second half of 2025. This will bring our total processing capacity in the Delaware Basin up to 1.4 BCF per day. In the Marcellus Basin, we are also progressing construction of the Harmon Creek 2 gas processing plant, which we expect will come online in the first half of 2024. Slide 6 outlines the second quarter operational and financial performance highlights for our logistics and storage segment. The L&S segment reported its second consecutive $1 billion adjusted EBITDA quarter. L&S segment adjusted EBITDA increased $56 million when compared to second quarter 2022, primarily driven by higher rates and growth in total throughputs. Crude pipeline volumes were up 4% and represent a new quarterly record for the partnership as we grew crude throughputs through expansion and de-bottlenecking activities. Product pipeline volumes were down 6% driven by more favorable market dynamics in the second quarter of last year and effects from Marathon's refinery turnarounds. Terminal volumes were up 3% due to effects associated with Marathon's refinery turnarounds in both quarters. Moving to our gathering and processing segment on slide seven, GMP segment adjusted EBITDA increased $18 million compared to the second quarter of 2022. as the benefits of higher volumes and throughput fees were offset by lower NGL prices. While our GMP segment is largely a fee-based business, we do have some direct sensitivity to natural gas liquids prices. For the quarter, NGL prices averaged 63 cents per gallon, as compared to $1.18 in the second quarter of 2022, resulting in a roughly $50 million headwind for the results. Total gathered volumes were up 9% year-over-year due to increased production in the Utica and the Permian. Processing volumes were up 6% year-over-year, primarily from higher volumes in the Marcellus and Permian, driven by increased customer demand and our investment in Permian processing capacity. Focusing in on the Marcellus, by far our largest basin of GNP operations, We saw year-over-year volume increases of 3 percent for gathering and 5 percent for processing, driven by increased customer demand. Fractionation volumes grew 10 percent, primarily due to recent increases to our fractionation capacity to meet in-basin demand for ethane. Our capital allocation framework remains unchanged, and year-to-date, we have returned $1.6 billion through distributions to our unit holders. We continue to expect our distribution to be our primary return of capital tool, and opportunistic repurchases of units held by the public also remain a tool to supplement capital returns. The growth of our cash flows and strong balance sheet, including a quarter-end cash balance of over $750 million, provides us with financial flexibility to continue to optimize capital allocation and return of capital. Now let me hand it back to Mike for some final thoughts.

Thanks, John. In closing, MPLX's growth strategy continues to support our commitment to return capital to unit holders. MPLX remains a strategic part of MPC's portfolio, supported by over $2 billion MPC expects to receive annually from MPLX distributions. And as MPLX pursues its growth opportunities, we expect the value of this strategic relationship will continue to be enhanced. We continue to be confident in our growth opportunities and ability to generate strong cash flows. By advancing our high-return growth projects anchored in the Marcellus and Permian Basins, along with our focus on cost and portfolio optimization, we expect to grow our cash flows, allowing us to continue to reinvest in the business and return capital to unit holders. Now let me turn the call back over to Christina.

Thanks, Mike. As we open the call for questions, we ask that you limit yourself to one question plus a follow-up. We may reprompt for additional questions as time permits. With that, we will now open the call to questions. Sheila?

Thank you. We will now begin the question and answer session. If you have a question, please press star then 1 on your touchtone phone. If you wish to be removed from the queue, please press star then 2. If you are using a speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press star then 1 on your touchtone phone. Our first question comes from Brian Reynolds with UBS. Your line is open.

Brian Reynolds Hi. Good morning, everyone. Fundamentals of the Permian continue to be really strong, and I was just curious if you could provide a little bit more detail on the Bangal pipeline expansion. Is this really driven by, you know, growth on MPLX's dedicated acreage? I'm curious about, you know, further potential expansion or extension opportunities on that Bengal pipeline in the future. Thanks.

Yeah, good morning, Brian. I'll start off and I'll let Dave kick in there. You know, we've been trying to tell the market that, you know, our main basins, Marcellus, Permian, is where we're concentrating a lot of our capital efforts. The announcement today of continuing the ad processing plan and as you're you know, question around Bangle just further solidifies where we've been putting a lot of our emphasis. So let me let Dave give you a little bit more color on Bangle specifically.

Hey, Brian. So let me start off just by a little background. Of course, you know, we're a 25% owner and existing of Bangle system, and that was brought on service in Q4 2021. And we've been very happy with that capital efficient project. So start that as a foundation. And as we look at the expansion, it's really anchored by what you touched on, our growth and also just the overall Permian growth. And so our expansion of Bangla 200 a day is kind of a two-prong. It's the installation of additional pumping capacity on the existing mainline and then also construction of a new pipe on the southern section. So those together is what we're referring to as the expansion project. Noted, that project currently is projected to be complete the first half of 2025. Looking beyond 2025, should the supply and demand dynamics remain strong in the Permian, the Bengal partners are in a position, including ourselves, to consider additional expansions of the pipe. And the last comment I want to make is just to reinforce a note that John stated, is that You know, we currently anticipate financing this Bangle project at that level through the JV, and therefore, you know, that will not reflect in our capital outlook going forward. So just a couple points there. Thanks.

Great. Appreciate all that color. And then maybe to pivot to capital allocation and appreciate, you know, the color and the prepared remarks, but just kind of curious, just given that we're approaching, you know, the 3Q distribution, potential raise that we've seen in prior years and given MPLX's preference for the DPU raise over buybacks from the last few calls. Curious if you could just perhaps talk about, you know, an optimized capital structure at MPLX just given that, you know, leverage is starting to trend below 3.5.

Hey, morning, Brian. It's John. Thanks for the question. Yeah, I mean, I think as we've said, we've been focused on the distribution as our primary return of capital tool. We'll look at that in the second half of the year like we did last November and Certainly, we're coming from a position of strength, right? A strong balance sheet, leverage around 3.5, distribution coverage 1.7, and $750 million of cash on the balance sheet really gives us that flexibility to work to optimize capital return. Again, focused on the distribution as that tool as we think about where we want leverage, I'm sorry, coverage to go, but very comfortable with where we are. You know, we did a 10% increase last year, and our coverage has actually gone up. So I think in a strong position. And maybe one other thing, too, I mean, you know, certainly we haven't done any buybacks the last two quarters, but it does still remain a tool for us. Again, we try and be trying to optimize in that area as well and being opportunistic with those repurchases. But as I'm sure you and others have seen, the volatility in the units has almost moved to nothing, which has maybe removed some of those opportunities for us recently, but still remains a tool for us. Mike, I don't know if you wanted to add. No, good. I hope that answers your question, Brian.

That's it. I appreciate all the color and enjoy the rest of your morning. Thanks. Thanks.

Thank you. Next, we will hear from Keith Stanley with Wolf Research. You may proceed.

Hi. Good morning. Thank you. If I could just follow on the last question on capital return to start. Obviously, you haven't done the buybacks in the first half of the year. You did a lot last year. You did $500 million. How are you thinking about total capital return and prospects for growing total return of capital? the unit holders just because buybacks are going down? Should we think distribution growth can kind of offset that and make up for it so you have growing total return of capital? Just overall thoughts on that value proposition.

Hey, Keith, it's Mike. Let me start, and I'll pick up where John left off in the last answer and try and give you a little bit more color. So, you know, I color code our cash flows and, you know, I use red and blue as the examples. You know, red cash flows are cash flows that we don't count on, you know, at a continuing basis, but they're a source of equity. Blue cash flows are those that we think that are there continually, you know, ongoing in time. And what we typically think about is, you know, as a general rule, not that you can't apply both, but, you know, red cash flows are buybacks and blue cash flows support the distribution. We can use blue for buybacks, but just as a general rule, think about it that way. As John mentioned, you know, we have a decent amount of cash on the balance sheet, mainly because in the last two quarters, you know, our volatility has changed quite a bit. I don't know that we have a good reason for that. But prior to that, you know, we were buying back, you know, using red bar cash flows at a significantly lower number than where we trade on average. In other words, during the quarter, we get these dips, you know, the capital markets give these dips that we hit opportunistically. So, if you look back in time, we've bought over a billion dollars of buybacks and we've averaged, you know, less than $30. and mainly because we've gotten these dips, the volatility of the stock trades, in such a way that we get these dips that we've acted on. Now, in the last couple quarters, you know, we haven't had those dips the way we've seen in the past. Again, I don't know exactly why that volatility has come out, but as a result, that cash is still sitting on the balance sheet. So we still have two sets of cash flows sitting on the balance sheet, some that's still targeted for buybacks, and some that's targeted for, you know, ongoing growth in the distribution. You know, as a matter of course, you know, the main thing that we concentrate on is generating cash, right? Obviously, that's the name of the game here. And I've said on a couple other calls, you know, that we're trying to do, you know, mid-single digits. And if you look at our slides, it'll show you there's a good chart in there that shows you our distributable cash flow over the last couple years has averaged a little under 7%. So, the main focus for us is let's make sure we're growing the partnership, growing those cash flows, identifying the type of cash flows we see, and then looking to implement a program that supports distribution growth long-term, which we've said is our primary tool, mainly because we're mainly growing blue cash flows. You know, when we get the red cash flows, you know, we look at those to supplement our program and be a little bit more opportunistic. Now, some investors have said, hey, you know, why don't you use Blue for buybacks? You know, that's still a tool as well as John used the, you know, analogy. These are all, you know, on our tool belt. And we'll continue to think about those. So, where we stand right today is I don't want people to look at our results and read into it that we're not thinking about buybacks. We are, but we've just been surprised at how the volatility has changed quite a bit in the last couple of quarters. So, we'll rethink that a little bit going forward. In the meantime, as John mentioned, you know, we still have that cash on the balance sheet. We are looking and we'll talk to you next quarter about where we're going to go with distribution growth. But we're in a good position, mainly driven by the fact that our concentration is growing the cash flows and then trying to optimize for as much value as we can. I hope that helps.

Yeah, that is helpful tying the cash balance to the buyback activity. Second unrelated question, just curious, the company historically hasn't been a big acquirer of assets, but it does seem like we've seen asset prices come down in the market recently, and obviously you have a lot of financial flexibility. Just any updated thoughts on how you're thinking about the potential ability to play a role in M&A?

Yeah, Keith, it's something, again, it's on the tool belt. It's something that Dave and the team continually look at. We measure it against our own internal organic growth projects, and very often we find that we have a list of projects that we just think will get us a higher return compared to some of the opportunities out there. But we're looking. You know, we're always active in trying to manage that process, whether it's, you know, inbound or something that we're thinking about. but we're comparing it against, you know, what we have internally. You know, I've said a couple times recently that some of these smaller, you know, maybe not flashy projects, they generate significantly higher returns. You know, we're a pretty large size MLP, and to grow, you know, 6% to 7% DCF CAGR, you know, requires us to get good returns on the project. So I use the term strict capital discipline. We try to, as best we can, you know, look at all of our opportunities and then put the capital to work to get us the best return. So it's something that's out there. We haven't seen something that we would like. You know, I will tell you we've been active in some processes, but we're also kind of disciplined as to what number we're willing to do and what number we're willing to walk away from. So I think that discipline serves us well and keeps us in a good position to grow the partnership with good returns. Thank you. You're welcome, Keith.

Our next question comes from Jeremy Tonette with JPMorgan. Your line is open.

Hi, good morning. Good morning, Jeremy. Just wanted to pick up on the last comment you put out there, the 6% to 7% DCF TAGR. Is that something that you see the business being able to achieve over some sustained period of time, you know, realizing that's not a guidance number, but just trying to dig into that comment a little bit more.

Jeremy, I've said it a couple times, and thank you for saying it's not meant to be guidance. It's just meant to be, you know, what we see as far as our capital spend that we think is appropriate for us, the size of our, you know, current EBITDA and DCF, that, you know, mid-single-digit growth, you know, kind of fits what I think is our financial model. So as we sit down as a team and talk about, you know, our plans for next year and the next three years and the next five years, I kind of think about where we're going to be as far as, you know, growing our cash flows, et cetera, et cetera. So, you know, it's not meant to be guidance, and I said that a couple calls ago. But I just kind of point to, like I said, if you look at our slide, and John mentioned this, our business – can be stair-steppy as opposed to continuous because you bring a plan on here or there or start a pipeline up here or there. So, if you actually look at our slide, it'll show you that, you know, we had 6 percent, you know, then we had about 10, then we had about 4. And, you know, if you look over the timeframe, you know, the CAGR was a little under 7. So, year-to-date this year, we're about 6 percent DCF growth. And that's kind of for the size we are, for the capital that I think we want to execute. it kind of puts me in that realm. And that's why I think, you know, we've been showing, hopefully the market's been seeing, you know, very steady cash flows, but more importantly, growing cash flows. You know, there was some concern, if you go back a couple of years with COVID, you know, on the stability of cash flows. And I think we've shown that even through 2020. But more importantly, I hope the market is picking up that we're being really thoughtful as to our capital investments and we're growing the partnership. And then we get to the topic that, you know, Keith just recently asked. After growing the cash, which is the priority, then optimizing, you know, how do we invest and how do we return? So I continually say these businesses are both a return on and a return of capital business, and we're trying to concentrate on doing well in both areas.

Got it. That's very helpful there. And just wanted to pick up on another comment you said there regarding With regards to CapEx deployment, just wondering any thoughts you might be able to share with regards to what type of capacity on an annual basis you see MTLX having to deploy growth capital? And then on the other side, I guess, given the assets as they sit right now, what type of opportunities do you see it matching there? Or is there interest in kind of expanding in other platforms to create new growth initiatives?

Jeremy, it's a good question. And in our capital allocation framework, you know, we clearly identify return on to be a higher priority than return of. You know, we are looking to grow the cash flows and we are looking to invest. Right now, we've been kind of in a pattern such that we're generating, you know, $5 billion of distributable cash flow, but we're investing capital such that we have about $1 billion of free cash flow beyond that. And that's served us well. But to your point, it's not limiting us. If we see more investment that we like, you know, we're happy to do that. And that's countered by this concept of being strict on capital discipline, making sure we get good returns. I think it's really important in this space to show the market that when we invest capital that we're going to get good returns on it. And if we continue that track record, then I think people will support the equity. In the short term, you know, that's about where we've ended up. But to the question that was asked earlier, you know, we are open and we, you know, constantly are debating what's the right level and what are the right projects and where do we think we should deploy, you know, the money that's owned by the owners. And to the extent that we feel good about it, we've ended up with this, you know, roughly about a billion dollars of capital investment, roughly, and that's left us with about a billion dollars of free cash flow. So we've kind of been in that mode recently. We're comfortable with it. but we also have flexibility around it as well, if that makes sense to you.

Got it. That is very helpful. Thank you for that.

You're welcome, Jeremy.

Thank you. And once again, if you would like to ask a question at this time, you can press star 1 and record your name when prompted. Our next question will come from Teresa Chen with Barclays. Your line is open.

Morning. I'd like to touch on John's comment earlier about the level of distribution increase. So from a backward-looking perspective, John, it sounds like the 10% last year with coverage going up was maybe too low. And as we think about the third quarter this year and beyond, especially arguably as we have more and more blue cash flows with, you know, online projects based on fee-based contracts and visible volume growth, should we think about that 10% as more of a floor?

That's a definition of a champagne problem, Theresa. But I'm not – thanks for the question. But I don't know if I'd think about it as a floor. Again, we try and be cognizant of where we are. Again, you know, Mike talks about red and blue. We think about that blue. We think about the capital we want to put to work. We can look at that and say, how do we kind of fiddle that into kind of a self-funding model, even though, hey, if we've got the right project, we could go and finance it, but certainly where the balance sheet is now, it's not really a question. So, you know, I think we're trying to be prudent around the increase and how we think about the percentage. Certainly that percentage last year versus our peers was very different. Again, some peers have cut and they're kind of reinstating their distributions back to where they were. You know, we haven't cut our distribution. So I think about it more around the framework of that blue bar cash we have. How do we almost glide path to our ultimate growth rate of where the partnership's going to be? Because to some degree, what we've done here is We managed through COVID, continued to grow the partnership. We were driving blue bar cash flows and essentially drove our coverage up. So now we're thinking about, all right, we're comfortable with the business, confidence in those cash flows. How do we work those cash flows into the distribution? And ultimately, over time, kind of align that with the growth rate of the partnership. So I don't know that I would say it's a floor, but certainly a marker for what we did last year. Hopefully that helps a little.

Thank you. And on the topic of low-carbon technologies, would you provide some color on how you're thinking about your potential participation, and what are the pathways and really the likelihood of commercialization for hydrogen CCUS hubs within your footprint?

Yeah, Teresa, this is Dave. Let me touch on that for you. So, ourselves, MPLX along with MPC, we've been, we are involved right now on three of the hydrogen hubs out there, three of the 33 that have made it to the final, you know, submittal for funding phase. So, and those projects are, you know, unique and it's their own as far as level of, level investment. So, those are, you know, in the final submitment phase. We anticipate getting final response from the DOE at the end of this year. And I think I want to go back to the comments that both Mike and John touched on. So while we're involved in these, a lot of it's dependent on DOE funding, but it's all back to strict capital discipline. As we look at the emerging energy evolution, emerging technologies, carbon capture, hydrogen, We're excited about it. It is part of our strategy going forward, but it's with the backdrop of, you know, ensuring that the money we're investing achieves the rates returns that we're targeting. So, more to come on that. And I think as DOE makes their final decisions on their grants and their funding at the end of this year, we'll have some more updates on it.

Mike Pratt- Therese, it's Mike. I just want to add, you know, one of the benefits we have is our footprint. And as Dave mentioned, you know, we're active in at least three of those hubs right now so that we can participate in the discussion, whether it's on the Gulf Coast or up in Marcellus or in the Bakken or wherever it is. You know, our footprint allows us to have these opportunities. And, you know, to the question I was asked earlier, you know, one of the advantages of having this wide footprint and the connectivity that we have is, you know, our organic choices are strong. which gives us the ability to, you know, forego having to do something else because our plate has enough activity on it that gives us a good enough return. So, I think one of the strengths we have is the breadth of our portfolio. And we're always, you know, trying to figure out how to optimize that and where we think, you know, we can benefit by being stronger. As you heard today, you know, investing some more capital in the Permian. You know, we've been very open about that's an area of concentration for us, and we put a lot of effort there. So continuing to grow our footprint in that area should not be a surprise to anybody. But to your question on low carbon, we are looking a lot at different things, as Dave mentioned, but we are coming back to, you know, it's got to show a return that makes sense to us if we're going to deploy capital. So hopefully that helps as well.

Peter, thank you.

You're welcome, Teresa.

And our last question will come from Neil Dingman with Truist. Your line is open.

Good morning, guys. Thanks for getting me in. My question first is just on potential non-core divestitures. I think, specifically, you all have mentioned in the past how you're looking to potentially shed some of the non-core terminals or GNV utility lines. I'm just wondering, what's the magnitude of potential sales we still could expect going forward?

Yeah, hey, Neil, it's John. Thanks for the question. Yeah, as you note, we've had some assets here and there, smaller ones on probably both the L&S and GNP side of the shop that we've been able to, you know, find other owners for. You know, I think when this comment, and we continue to look at that, right, around all of our assets, if they don't make sense in our hands, do they make sense in others? I would say the large majority of those assets on the L&S side, we know are customer NPC and We know how critical those are to their operations. On the GNP side, we talk from time to time about some of the basins we're in, which are much smaller than our presence, say, in the Marcellus, which is really the largest part of our GNP operations. Look, those are generating free cash flow, but we're maybe not looking to significantly invest in those. So if there's someone that maybe that fits better in their portfolio, we would listen. Again, there's been a little bit of a gap between the bid and the ask there, and given they're not kind of a burning platform for us, we haven't had significant urgency to do something there, but something we'll always look at.

Yeah, that makes sense. And then just my last one is on the crude pipeline growth. You all mentioned volumes. I think you set it up at 4% part due to the debottlement, and I'm just wondering if Can this growth continue as maybe there's future opportunities you're looking at?

Hey, Neil, this is Sean. You know, we're pleased where we are right now with the crude pipelines growth, you know, and it's really driven by the high refinery utilization. But we continue to look for organic projects that unlock, you know, de-bottlenecking, increased capacity. So we'll continue doing that, as Mike and John said, as we look forward and future capital outlays. again, really to match the refineries and the needs of our customers that are connected to our crude pipeline. So, again, we're pleased at where we're at, and we'll continue looking for those organic growth opportunities.

Great. Thank you all for the time.

You're welcome.

All right, Sheila. Is there anyone else in the queue?

We are showing no further questions at this time.

Sounds great. Thank you so much for joining us today, and thank you for your interest in MPLX. Should you have additional questions or would you like clarification on any of the topics discussed today, members of the investor relations teams will be here today to help out and take your calls.

Thank you. That does conclude today's conference. Thank you once again for your participation. You may disconnect at this time.