AltaGas Ltd.

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the AltaGas Third Quarter 2023 Financial Results Conference Call. My name is Sarah and I will be your operator for today's call. All lines have been placed on mute to prevent any background noise. If you have any difficulties hearing the conference, please press star zero for operator assistance at any time. After the speaker's remarks, there will be a question and answer session. As a reminder, this conference call is being broadcast live on the internet and recorded. I would now like to turn the conference call over to Adam McKnight, Director, Investor Relations. Please go ahead, Mr. McKnight.

Thanks, and good morning, everyone. Thank you for joining us today for AltaGas' third quarter 2023 financial results conference call. Speaking on the call this morning will be Vern Yu, President and Chief Executive Officer and James Harbalis, Executive Vice President and Chief Financial Officer. We're also joined here this morning by Randy Toon, Executive Vice President and President of our midstream business, Lou Jenkins, Executive Vice President and President of our utilities business, and John Morrison, Senior Vice President, Corporate Development and Investor Relations. We'll proceed on the basis that everybody has taken the opportunity to review the press release and our third quarter results, This call is being webcast, so I encourage those of you listening on the phone lines to follow along with the supporting slides that can be found on our website. As always, today's prepared remarks will be followed by an analyst question and answer period, and I'll remind everyone that we will be available after the call for any follow-up or detailed modeling questions that you might have. As for the structure of the call, we'll start with Bernu providing some comments on our financial performance and progress on our strategic priorities, followed by James Harbalis, providing a more detailed walkthrough of our third quarter financial results, our near-term outlook, and our 2023 guidance. And then we'll leave plenty of time at the end for Q&A. Before we begin, I'll remind everyone that we will refer to forward-looking information in today's call. This information is subject to certain risks and uncertainties as outlined in our forward-looking information disclosure on slide two of our presentation, which can be found on our website, and more fully within our public disclosure filings on CDAR. And with that, I'll now turn the call over to Vern.

Thanks, Adam. Good morning, everyone. It's great to be here today to discuss Altagas's third quarter financial results and to provide you with an update on our operations and our corporate priorities. During the quarter, Altagas made significant progress on a number of these strategic priorities that will create long-term value And I'll touch on these in my remarks. In Q3, we also demonstrated strong financial performance and stability. Management was focused on operational excellence and proactive risk management. Let's start with slide four. Here we show AltaGas continued to execute on its long-term business strategy, and we delivered strong results across the board. Q3 came in with normalized EBITDA of $252 million and normalized EPS of $0.10 per share, which were both above our internal expectations for the quarter. With the completion of Q3, coupled with our prior results for the first half of the year, we're well positioned relative to our 2023 guidance. And in fact, we now expect to come in in the upper half of the range. Let's move to slide 5, which shows that midstream performance in Q3 was robust. Operating results reflect record export volumes and strong global demand for LPGs. And these results highlight Canada's West Coast advantage for LPGs. Global LPG demand has been robust this year, growing by 3% over 2022. We expect similar growth in 2024, which will continue for many years to come, primarily on the back of growing long term demand for LPGs in Asia. In Q3, global export volumes were up 7% year over year. Fractionation and liquids handling was up 12% year over year. Our gas processing volumes were down modestly in the quarter due to maintenance. However, volumes have already recovered from these planned outages. We had 93% of global exports told or financially hedged in the third quarter, protecting our structural West Coast advantage. For the balance of 2023, 87% of our global export volumes are told or financially hedged. We have also been active in hedging our 2024 exposure. where 76% of Q1 is now hedged, and we are more than 50% hedged in Q2. This reflects our ongoing commitment to reduce the volatility in our midstream segment. Let's move on to our Pipestone acquisition that we announced in August. Since the announcement, we have received all material regulatory approvals, including Canadian Competition Act approval. We are currently working on finalizing commercial agreements with our customers and locking in fixed price EPC contracts for Pipestone 2, which will allow us to FID and close the transaction, which we expect to occur prior to year end. As a reminder, the acquisition is a strong strategic fit for AltaGas. It will be risk accretive through long-term take-or-pay commercial contracts, and the deal reduces our overall commodity exposure. The transaction was also purposely structured to reduce our leverage. And it will draw a 5% earnings accretion once Pipestone 2 comes online. We're excited to close the transaction and integrate the assets into AltaGas's midstream value chain. Our reef LPG export expansion continues to make good progress. The project is in the feed stage with an FID expected in the first half of 2024. We have plans to start site clearing work before the end of the year. And finally, we continue to make strong advancements on long-term commercial agreements that will de-risk the expansion. Just as a reminder, we're proud to have strong local partners for the projects. This includes First Nations, local communities and the Prince Rupert Port Authority. Slide 6 shows that our utility segment performed in line with our expectations in the quarter. I believe that gas utilities are irreplaceable and are a key part of the ongoing energy evolution. Natural gas accounts for nearly 70% of U.S. household energy demand, yet only represents a third of home energy costs. As such, natural gas is the most cost-efficient home energy source. In fact, switching to electricity would increase home energy costs by roughly 350% for the average homeowner in our franchise area. It's also the most reliable source of energy for homeowners. as we all know about the declining reliability of the power grid. As such, we believe our utilities will be critical in the years ahead. We remained active on the regulatory front in all of our jurisdictions in the quarter. In August, we received a positive settlement on our Virginia rate case, which calls for $41 million U.S. of increases in rate-based rates. as well as the $32 million US increase in modernization riders. In October, we received a proposed system modernization extension in Maryland, which will run through the end of 2028. The proposal will provide WGI with another five years of visible growth. The administrative law judge has recommended that the commission approve $330 million US of capital to upgrade our system, improving safety and reliability. This builds on our accelerated pipe replacement program in Virginia that was recently extended to the end of 2027. Our rate cases in DC and Maryland remain ongoing. We expect a decision in Maryland before the end of this year and a decision in DC in the first quarter of 2024. As we have messaged in the past, we expect to show a high degree of regulatory, capital, and cost discipline across all of our jurisdictions. That will include being active with our regulators as we push for the most pragmatic approach to drive the best outcomes for all of our customers and stakeholders. Now let's spend a minute on WGL's first large-scale RNG initiative. In October, WGL executed a definitive agreement with Opal Fuels to support an RNG project at the Prince William County landfill in Virginia. Here, WGL will become a RNG offtaker for the RNG production that comes from the landfill. The RNG will be blended into our gas stream, which will reduce the carbon intensity of our energy. As part of the agreement, WGL will purchase interconnect infrastructure from Opal for around $25 million US. The interconnection will be put into rate base and it will be eligible to earn 100 basis point ROE premium. This is a great little deal for us. It reduces the emissions of our customers. It adds to our rate base and then we're actually able to earn an ROE premium. The more time I spend here at AltaGas, the more excited I could become about our long term investment proposition. James will cover this off in more detail in his section. With that, I'm going to turn it over to James to provide a more fulsome review of our third quarter results and update you on our financial priorities.