Usd Partners Lp

Ladies and gentlemen, thank you for standing by and welcome to the USD Partners LP fourth quarter 2021 results conference call. At this time, all participants have been placed in a listen-only mode. The floor will be open for your questions following the prepared remarks. If you would like to ask a question at that time, please press star one. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. When asking a question, We ask that you please pick up your handset to allow optimal sound quality. Lastly, if you should require operator assistance, please press star zero. It is now my pleasure to turn the call over to Jennifer Waller, Director of Financial Reporting and Investor Relations, for opening remarks. Please go ahead.

Thank you. Good morning, and thank you for joining us. Welcome to our fourth quarter 2021 earnings call. With me today are Dan Borgen, our Chief Executive Officer, Adam Altshuler, our Chief Financial Officer, Brad Sanders, our Chief Commercial Officer, Josh Ruppel, our Chief Operating Officer, as well as several other members of our senior management team. Yesterday evening, we issued a press release announcing results for the three months and year ended December 31st, 2021. If you would like a copy of the press release, you can find one on our website at usdpartners.com. Before we proceed, please note the safe harbor disclosure statement regarding forward-looking statements in last night's press release applies to the statements of management on this call. Also, please note that information presented on today's call speaks only as of today, March 3, 2022. Any time-sensitive information provided may no longer be accurate, at the time of any webcast replay or reading of the transcript. Finally, today's call will include discussion of non-GAAP financial measures. Please see last night's press release for reconciliations to the most comparable GAAP financial measures. And with that, I'll turn the call over to Dan Borgen.

Thank you, Jennifer, and good morning, and thank you for joining us on the call today. 2021 was a momentous year for the partnership as well as for our sponsors. and I would like to start off by covering a few highlights from the year. Our terminals continue to perform safely and reliably throughout the year. The partnership continued to generate a significant amount of free cash flow, which continues to be supported by our strong contract structure and high-quality investment-grade customers. Our sponsor and its joint venture partner declared the DRU to be fully operational, and we commenced shipment of Drewbit by rail in December. As a brief reminder, our Drew Bit by Rail network has already enhanced the sustainability and quality of the partnership's cash flows by significantly increasing the tenor of approximately 32% of the Harder C Terminal's capacity through 2031. We announced a new five-year renewable diesel throughput agreement underpinned by an investment-grade rated refining customer at the partnership's West Colton terminal. And we also announced a five-year agreement that became effective January 1, 2022, with our ethanol customer at the West Colton Terminal that replaced our legacy short-term agreement. This new agreement is expected to generate higher cash flows for the partnership as compared to the previous agreement. And last but not least, our sponsor formed a new subsidiary, USD Clean Fuels, LLC, which is focused on providing production and logistics solutions to the growing market for clean energy transportation fuels. We are committed to the transition into sustainable fuels and look forward to future announcements related to USD clean fuels. Turning back to the fourth quarter, the partnership increased its quarterly distribution with respect to the fourth quarter by approximately 2.1% relative through the third quarter of 2021, which was in line with our previously announced distribution guidance. We hope to continue our momentum in 2022 and are encouraged about the future as we engage with our customers regarding the second phase of the DRU and the partnership's growth. Accordingly, management intends to recommend to the Board of Directors of its general partner to remain on its current distribution growth trajectory of increasing its quarterly CAS distribution per unit by an additional quarter of a cent per quarter for the first, second, third, and fourth quarters in 2022. As previously mentioned, construction of both the DRU and PAT projects was completed and both are now fully operational and throughput volumes are consistent with contractual obligations and our customers' expectations. As a reminder, our Drew Bit by Rail network consists of the DRU and the Port Arthur Destination Terminal, or PAT. The DRU was constructed along with USC's strong JV partner, Gibson, and is located adjacent to the partnership's Harder C terminal. Our Drew Bit by Rail network also benefits the partnership by providing longer-term, take or pay revenues at its Harder C terminal, while providing transportation safety and environmental benefits to its customers. We look forward to sharing future announcements with the market about the next phase of growth at the DRU. Next, Adam is going to give us an update on the partnership's latest financial results and our liquidity position. Then we'll jump back into the recent market and commercial developments. Without Adam, please go ahead.