Energy Transfer LP (ET) Q4 2017 Earnings Report, Transcript and Summary

Good day and welcome to the Enable Midstream Partners Fourth Quarter and Full-Year 2017 Earnings Conference Call and Webcast. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Enable’s Senior Director of Investor Relations, Mr. Matt Beasley. Please go ahead.

Thank you, and good morning, everyone. Presenting on this morning’s call are Rod Sailor, our President and CEO; and John Laws, our Chief Financial Officer. We also have other members of the management team in the room today to answer your questions. Earlier this morning, we issued our earnings press release and filed our Form 10-K with the SEC. Our earnings press release, Form 10-K filing and the presentation that accompanies this call are all available in the Investor Relations section of our website. We will also be posting a replay of today’s call to the website. Today’s discussion will include forward-looking statements within the meaning of the securities laws. Actual results could differ materially from our projections and the discussion of factors that could cause actual results to differ from projections can be found in our SEC filings. We will also be referencing non-GAAP financial measures on today’s call, which we have reconciled to the nearest GAAP measures in the appendix to today’s presentation. We invite you to review the disclaimers in this presentation for both forward-looking statements and non-GAAP financial measures. With that, we’ll get started and I’ll turn the call over to Rod Sailor.

Thanks, Matt. Good morning. And thank you for joining us for today’s call. Enable ended 2017 with another great quarter of performance. In the fourth quarter of 2017, natural gas gathered, processed and transported volumes as well as crude oil gathered volumes, all increased compared to the fourth quarter of 2016. The increased volumes contributed to higher net income attributable to common units, higher adjusted EBITDA, and higher distributable cash flow for the quarter compared to the fourth quarter of 2016. Our strong fourth quarter financial and operational results capped off a record year for Enable. I am proud to announce that in 2017, Enable delivered the highest full-year results for gathered volumes, processed volumes, NGLs, produced and transported volumes as well as the highest full-year results for adjusted EBITDA and distributable cash flow, since Enable’s formation in May of 2013. Slide five highlights our commitment to growing our business while remaining financially disciplined. Our major commercial successes in 2017 included the Wildcat and CaSE projects and the Align Midstream acquisition. Once online, Wildcat and CaSE will provide over 600 million cubic feet per day of capital-efficient market solutions for growing supply in the Anadarko Basin while the acquisition of Align Midstream extends our footprint in the active Ark-La-Tex Basin and further optimizes our midstream services and product lines in the region. During the year, we were also successful in contracting firm, fee-based agreements on EGT and EOIT pipelines and continued to increase acreage dedicated to our gathering and processing segment. We continued to balance our business growth with a focus on cost discipline. We saw significant growth in revenues and gross margin in 2017 while keeping our O&M and G&A expenses flat to 2016 levels. I am also pleased to announce that we exceeded the upper end of our 2017 outlook ranges for net income, adjusted EBITDA and distributable cash flow. We achieved our objectives in 2017 while maintaining a strong balance sheet and generating significant distribution coverage. We ended the year with a total debt to adjusted EBITDA ratio of 3.75 times and with a distribution coverage ratio of 1.2 times. That distribution coverage equates to approximately 35% of our expansion capital spending for the year, excluding our M&A activities. Turning to slide six. We will look to build on our success in 2018, leveraging our strategically located assets and our highly interconnected systems. As you can see, there is significant growth in both producer supply and expected market demand around our footprint over the next couple of years, and Enable is well-positioned to serve this growth. Turning to slide seven. Our gathering and processing segment has the right assets in the right places. We see positive activity and development in each of our basins, and there are 49 rigs drilling wells to be connected to our gathering system. As a result of the strong producer activity across our footprint, our natural gas gathered volumes have increased for eight consecutive quarters and we are well-positioned for continued growth. In the Anadarko Basin, we continue to hold a market leading SCOOP and STACK position, and we offer producers over 1.8 Bcf per day of processing capacity in the basin. Rig activity remains strong in the basin with 35 rigs drilling wells to be connected to our gathering systems in the SCOOP and STACK plays. Our Wildcat project provide an additional 400 million cubic feet per day of processing capacity for growing SCOOP and STACK production, and the project remains on schedule for second quarter of 2018 startup. We are also seeing significant rig activity and production growth in the Ark-La-Tex Basin. We saw our gathered volumes in the basin increased by 40% in 2017 as producers in the Haynesville and Cotton Valley plays improved their completion techniques and drilled longer laterals. 2018 will see a full-year impact of the Align Midstream acquisition, and we continue to work to optimize and integrate those assets. In the Arkoma Basin, leasing activity in eastern Oklahoma has significantly increased, leading to growth opportunities in both wet and dry gas windows. During the fourth quarter of 2017, we signed a new 10-year fee-based natural gas gathering contract with approximately a 138,000 gross acres of dedication from a producer focused on drilling lean gas areas of the Arkoma Woodford Shale. We have natural gas gathering contracts with minimum volume commitments in the Ark-La-Tex and Arkoma basins. Natural gas gathered volumes in the Ark-La-Tex Basin have increased for eight consecutive quarters, and continued growth further reduces shortfall payments and provides the opportunity for increased margin as volumes exceed in DC [ph] levels. Finally, in the Williston Basin, crude oil gathered volumes continued to grow as a result of the recent 8,000 barrel per day system expansion and continued improvement in producer completion techniques. Moving to slide eight. Enable’s transportation and storage assets are highly integrated and well-positioned to provide market solutions for both growing demand and supply markets in and around our footprint. Our 5,900-mile Enable Gas Transmission pipeline system supports producer activity and market demand across six states. Significant producer growth in the Anadarko Basin has driven increased demand for transportation capacity. And in the fourth quarter, we signed a three-year 1,000 dekatherms per day firm transportation agreement with an Anadarko Basin producer. The transportation agreement provides access to delivery points on the west side of our EGT system that connect the downstream markets in the West and the Midwest. With this project and completion of our CaSE and Wildcat projects, we will have provided over 1.1 Bcf per day of market solutions for SCOOP and STACK production since 2015. In January, Enable announced a 600,000 dekatherm per day open season for capacity on EGT’s Line CP. That included a foundation shipper that subscribed to total of 300,000 dekatherms per day of firm capacity. The open season ended in early February and we are currently evaluating the bids received. The Mississippi River Transmission pipeline system provides the St. Louis market with access to Mid-Continent and Northeast supply at competitive rates. MRT’s planned 2018 rate case provides us the opportunity to adjust rates, based on historical investments and updated contracted capacity levels. Our EOIT pipeline system continues to benefit from increased Anadarko production as well as its core position with Oklahoma utilities. Annual average deliveries on our intrastate system increased approximately 9% in 2017 compared to 2016 as a result of significant producer growth in the Anadarko Basin. Our Muskogee project is still on schedule to be in service by the end of 2018. And once online, the project will provide OG&E 228,000 dekatherms per day of firm contracted transpiration service for natural gas fired electric generation. Finally, the SESH pipeline is a 50% joint venture that serves the high growth demand markets of the southeastern United States and Florida with a diversity of supply from Southeast and Northeast markets through its interconnections with 20 third-party pipelines. I would now like to turn the call over to John to further discuss our fourth quarter and full-year operational and financial results.

Thank you, Rod, and good morning, everyone. I will cover a few of our key operational and financial metrics for the quarter and the year. As always, you can find a more detailed and comprehensive overview of our financial and operational results in the fourth quarter earnings release and in our 10-K, both of which were released earlier this morning. Turning to slide 10. The drilling and completion activity of our customers in the Anadarko and Ark-La-Tex basins resulted in increased gathered and processed volumes for the fourth quarter and the full-year of 2017 when compared to 2016. We also saw increases in our crude oil gathered volumes for both the quarter and the full-year of 2017, primarily driven by several multi-well pads coming online on our Williston Basin gathering systems and the expansion of our Bear Den system that Rod mentioned earlier. In our transportation and storage segment, our overall transportation volumes increased for both the fourth quarter and the full-year of 2017, primarily driven by increased average deliveries on our intrastate pipeline system in Oklahoma as a result of increased supply in the Anadarko Basin. Our interstate firm contracted capacity decreased for both the quarter and the year, primarily as a result of contract expiration on EGT’s Line CP segment. Turning to the financial results for the quarter on slide 11, our net income measures increased for both the fourth quarter and the full-year of 2017 when compared to 2016. The increase in net income for the fourth quarter was primarily due to higher gross margin and lower operation and maintenance, and general and administrative expenses. For full-year 2017, net income increased, primarily due to higher gross margin. Gross margin for the fourth quarter and full-year was primarily higher due to gathered, processed and transported volumes, higher NGL prices, and changes in the fair value of natural gas, condensate and NGL derivates. O&M and G&A expenses for the fourth quarter 2017 were lower, primarily due to a decrease in loss on sale of assets and a decrease in materials and supplies and contract services costs. For full-year 2017, O&M and G&A expenses were flat compared to full-year 2016. The increases in net income for the fourth quarter and full-year were offset by higher depreciation and amortization expense, as a result of the Align Midstream acquisition and additional assets placed in service and higher interest expense as a result of higher interest rates on outstanding debt and an increase in the amount of debt outstanding. Adjusted EBITDA increased for both the fourth quarter and the full-year of 2017, primarily as a result of higher gross margin after adjusting for non-cash items. Distributable cash flow increased for both periods due to higher adjusted EBITDA, partially offset by higher adjusted interest expense. After considering the distributions declared for the quarter, Enable generated a distribution coverage ratio of 1.06 times for the quarter and an impressive 1.2 times for the full-year of 2017. Moving to slide 12, we take a look at Enable’s key priorities for 2018. We continue to be committed to value creation through our pursuit of commercial, operational and financial excellence. We expect to continue to leverage our strong asset base, customer relationships, and business development capabilities to secure new, accretive, commercial projects, both on and off footprint. Operationally, we’re committed to safe and reliable operations as well as bringing our three major projects Wildcat, CaSE and Muskogee online on-time and on-budget. Our efforts will be accomplished while remaining committed to financial discipline, a commitment that served us well since our formation. Specifically, we expect to maintain our investment grade metrics as our business grows through efficient capital deployment, and a focus on operating costs. As we’ve guided previously, we expect to generate solid distribution coverage in 2018, which will be utilized to fund a portion of our expansion capital, and will serve to reduce future equity needs. Finally, we are reaffirming our 2018 operational and financial outlook that we provided in our third quarter 2017 earnings release. As we have discussed, the Partnership has performed incredibly well in 2017 and our momentum has continued into 2018. We continue to evaluate our 2018 operational and financial outlook ranges as we progress further into the year. That concludes my remarks. We’ll now open the call up for your questions.

[Operator Instructions] The first question comes today from Jeremy Tonet with J.P. Morgan. Please go ahead.

I want to start off with the Anadarko and the activity you are seeing there; it seems like it’s quite robust. And I was just wondering what your expectations were for how fast Wildcat could ramp up there? And then, do you see need for incremental processing infrastructure after that based on this deep level of activity?

Yes, Jim. I appreciate the question. We continue to be very bullish on activity in the Anadarko. Again, as it relates to the Wildhorse, is that the question?

Wildcat.

Wildcat. Yes. I mean, we -- as you know, that capacity will come online later in the year. The Wildcat’s capacity, we think our system will be full when that comes on and be much needed capacity. We continue to believe that we can stay in -- we will stay in front of expected growth and we continue to believe we will see robust growth in the Anadarko. But again, we are only talking right now about our ‘18 guidance. As you know, we have our Wildhorse project that’s on the shelf that is 200 a day processing that we can roll out when and if -- when we see the need for that, and we do anticipate needing that in the future.

And just turning to kind of the financials here. It seems like you guys have pretty strong setup here with coverage and leverage. And I was just wondering if you could help us think how you think about it philosophically as far as what the right level of coverage is for the business before you resume kind of distribution growth, is it really targeting kind of self-funding the equity portion of regular CapEx here or any other thoughts you can share there?

I think, we’ve been consistent and we’ve talked about this last year and we continue to talk about it, as we move into 2018 we think we’ve targeted kind of 1.25 distribution coverage, still a little bit under that. We think that’s the appropriate level. Right now, we think that in this environment with the factors that we are seeing that keeping a dollar inside the Company -- keeping those dollars inside the Company is the best course; we’re going to continue to focus on balance sheet and coverage. And we will continue to evaluate what’s the right level as we move through the year and understand some of the external factors that are impacting our business.

And as far as the guidance is concerned, it seems like you’re tracking a very strong level versus that just with the results here and commodity prices are above kind of the range that you guys have talked about in your guidance there. Would you look to kind of update guidance across the year, if either commodity prices stay above the range that you outlined in your guidance or activity is better than expected or just kind of put out guidance once a year?

I think, what we have tried to do the last couple of years, we’ve tried to get our guidance out early. And we feel comfortable doing that because we have excellent relationships with our customers; we have a good understanding of what -- of their drilling plans, most of our -- at least on the G&P side, our customers are just now rolling out their ‘18 guidance. Nothing that we see there, takes us away from what we believe we will see in 2018. As John mentioned, I think, we’re comfortable with where we put our guidance levels right now, and we’ll continue to evaluate whether we need to adjust those ranges, as we move through the year. And again, as we sit here in February, we’re comfortable with the ranges and we’ll continue to evaluate whether we need to change those as we go through the year.

The next question will be from T.J. Schultz with RBC Capital Markets. Please go ahead.

Maybe just first, another question on the guidance range, maybe just asked a little bit differently. The rig activity that you’re seeing or some of the recent acreage dedications by issue higher at all on that range in any particular geography, maybe just how does current activity or your line of sight on certain pads that may be coming online stack up to what you expected when you originally put out that guidance?

I think, I would say that we’re very pleased with the rig activity that we currently see. And again, we have a very broad footprint and we have areas that are more gassy than others. And so, I think, we feel very comfortable, as I said, starting with Jeremy. I think we feel very comfortable about where we set the ranges. We are very comfortable with clearly how we ended the year, and we’ll evaluate whether we think we need to do something with those ranges, as we move through. But, right now, I think, we’re comfortable where we sat and we’ll continue to evaluate activity. But, I would say, we are seeing activity across our footprint, and it’s very encouraging.

Second question just on ethane retention, any meaningful shift lately on rejection versus recovery on your systems?

I think, what we’re seeing, it sort of depends on which geography we’re talking about, but we’re seeing recovery economics be indicated for certain of our processing fleet, particularly those that do have the NGLs aimed at Mont Belvieu.

Okay. And lastly for me on MRT, just any update on recontracting some of the capacity, to Laclede or to others? And then on the rate case, what’s the timing on that this year, and would you expect to file for higher rates to offset any of the contract rollovers?

Yes. I think, we’ve been pretty consistent that we would -- we’ll file that rate case middle of the year. And again, we’ll factor in the best information we have at the time, and we’ll look to recover any anticipated turn-back at that point in time. There’s really not -- we really don’t have anything to update from our -- really from our third quarter call.

The next question comes from Shneur Gershuni with UBS. Please go ahead.

I won’t ask if you’re going to be at the higher end of guidance, but I did want to focus on a couple of other areas. First and foremost, you often question about CenterPoint and its intentions, and you obviously refer us back to CenterPoint and that’s fine. But, kind of looking at your increasing coverage ratio and kind of the excess distributable cash flow that you have, and certainly distribution increases could be something that could be in the forefront, but buybacks is also an alternative as well too. I was just wondering if there’s some sort of option where you could use the excess retained cash flow to look at let’s say, buybacks from CenterPoint or from ArcLight using some sort of the WAP [ph] to sort of help reduce the overhang that it creates? And then, secondly, as part of that, does the recent tax changes make it easier for them to sell?

Yes. I would address the coverage and our intent to use that. I think, we’ve been -- tried to be I think pretty clear on this that we’ve got a lot of opportunities, a lot of growth opportunities in front of us. And we again continue to believe that putting that back into the business in this market is the best use of that cash. And again, I think, as we always do, we’ll refer you to CenterPoint, their call is in a couple days. And we’ll all hear an update at that point in time as it relates to their next steps. But that’s really I think where we have to be on that one.

Okay, fair enough. As a follow-up, you talked about MVC levels in the Ark-La-Tex region. Are you currently above the MVCs at this stage right now and you could also talk about how you…

We…

Sorry?

I said, no, we are not yet above the MVC range in the Ark-La-Tex.

Okay. And once you go above, and I think you’d mentioned that your margin would actually expand. Can you give us a sense of I guess the sensitivity of what to think about once that was to occur?

Well, we’ve not yet disclosed the rate, the gathering rate there. But, if you think about where things are today, where previously we’ve been at about 50% or thereabouts in terms of our overall progress against MVCs or MVC margin, that’s been attributable to shortfall. And so, if you just take a look at flowing volumes relative to that margin, that’s going to be 2x of what we would then actually build should we be receiving margin on those, once they eclipse the MVCs. And so, I am giving you a long answer and not giving you an answer, but that’s just in part because we haven’t disclosed that information. I think, what we’ve -- what we’d really like for folks to understand and take away, particularly out of the Ark-La-Tex, we have added some disclosures in our 10-K around where we are more specifically by basin in terms of progress against the MVCs is at the current rates of activity, we see an opportunity to eclipse the MVCs before they expire, should these activity levels continue; at that point, then, you would see growth. But, we are not forecasting that necessarily in 2018.

I would just add that when the MVCs end on those Ark-La-Tex contracts, the contracts are still in place and in force for I think five years, past that. So, it’s not like the contract ends, we still have that dedication.

That makes sense. I guess, where I was kind of I guess a little bit confused that I would have thought if you’re below your MVCs, your margin would be higher than if you were above your MVCs, meaning you’re collecting more than per unit of volume. And so, I guess that’s what I was trying to understand, which is why I asked the question if you were above our MVCs, given your expectation for margin increase, and I was just wondering if you walk me through how that works.

So, yes, I mean, I think, -- look, well, as long as you’re beneath the MVCs, your margin is going to be static. Year-over-year, there’s certainly some seasonality as it relates to when the reimbursement occurs. But, once you eclipse the MVC levels, then you then get to bill on those incremental volumes, the contractual gathering or treating rate as it might be. And so, that’s where you start to see your margin expand. And so, while we’re continuing to make progress against the MVCs and close that shortfall payment gap, we’re just getting paid on flowing volumes as opposed to shortfall. And so, there’s not an expansion necessarily in the margin until those volumetric levels are eclipsed.

So, you’re talking about an absolute dollar expansion of margin rather than margin per Mcf, is that a fair to about it?

That’s right.

Okay, great. And then, finally, with the upcoming MRT rate cases, I think you brought up Laclede and some of the others that might still be -- that won’t necessarily give back capacity. Do the customers who will likely stay on this system, do they have any other alternatives? I mean, I would think that if they were to see their rates increase because others left system that they may choose to pursue other options. I was just wondering if you can address that thought.

Yes. And just to be clear, it’s the Laclede contract that is coming up middle of this year. We do anticipate some turn back on that, we don’t know at what level. They will still be a significant customer on MRT as well as others. And we’ll follow for rate recovery on the turn back amount and they’re -- and those other customers’ rates will go up. And I think we largely have the -- we supply significant amount of the gas into that market. And so, again, I think, we would anticipate -- and I think, if you look at -- I have to be careful what I say, but I think if you look at those that have been redeemed, some of those are customers on that system. And we’ll have the impact of those increased rates based on whatever turn back we see from Laclede.

Next question will be from Dennis Coleman with Bank of America Merrill Lynch.

A couple for me, please. I wonder, I know it’s a little bit early on the Line CP open season, but can you give us sort of any color or characterization on what you’ve seen so far?

We saw a little interest above the one customer that we referenced. And just so you know, we went out with an open season and that was really a sort of we could flow either east or west depending on how those customers wanted gas to flow. We did not -- we have not yet got to a level that we feel we could turn that system around. That’s why we continue to work with some of the other interest out there. But, again, we will contract at least at the 300,000 dekatherm level. We are still optimistic that maybe we can increase that a little bit and look for some bidirectional capabilities.

And then, I guess, just in terms of the growth, and clearly, it’s -- the questions are sort of -- questioning about signaling pushing guidance higher. But, in terms of additional growth projects and you hinted a lot of this on slide 12 and sort of underlying all the conversation, but, what can we think about timing for some of the decisions you might make in terms of additional projects over the course of the year? Obviously, there’s some lead times to some of these projects.

Yes. I think, our commercial folks did a great job. We have got -- talking to a number of parties, both on the G&P side and on the transportation side and in a perfect world, we will be announcing -- or we could announce some stuff as we go through the year, all dependent on getting to the right commercial contracts. But again, I think we’re very active. We are seeing activity across the footprint in all phases of the business. And look, when we land something, we will announce it. But we don’t have anything to announce other than the things that we’ve announced previously on this call. But, I would point you that I think we’ve had a pretty good track record over the last few quarters about announcing projects. So, again, as we’ve said a couple of times on this call, continue to see a lot of activity in all the areas that we are in.

That’s clear. Okay. One just last one for me, a little more detailed. On the hedging volumes, you added a fair amount of hedges during the quarter from what you showed at the end of the third quarter. And just wondering, have you started looking at 2019 yet in terms of hedging, and how you think about that question?

Dennis, it’s John. Yes. We’ve started looking into 2019 and where we see opportunities relative to our market view, we are looking to make additional hedging decisions for 2019.

[Operator Instructions] The next question comes from Nick Raza with Citi. Please go ahead.

Most of the questions I had have been answered, except a couple. On maintenance CapEx, you came in a little bit lower towards what you’d guided for 2017 and volumes are then up. In terms of going forward, can we expect a similar sort of run rate of maintenance CapEx, as you saw in 2017 and 2018?

Yes. I think, again, if you look at kind of our 2018 guidance, and that’s sort of a level that we think about at the current level of activity. You are always going to have some break fix, and so you have to factor that, and you got the planned things that you want to do, the planned things that you need to do, and then, like I said, you have some break fix then. So, sometimes that’s added, even sometimes you use other dollars. But, again, I think, we’re very comfortable with where we’ve been the last couple of years and where the guidance range is.

Okay. And then, on the MRT rate case, could you just give us your preliminary thoughts on what the tax implications are, whether you could expect to see some rates come down? I know, if Laclede doesn’t renew the contract, you have this cost to service that the remaining shippers have to bear. But, in terms of just the taxes, do you think that would actually be a benefit for shippers?

Nick, I think, at the end of the day, the lower tax rate is just one component of several that go into the ultimate determination of rate and recoverability. When we look at rates specifically on MRT, the last settled rates we had back in the 2012 rate case, were effectively in a black box settlement. So, it’s difficult to discern, if not impossible to discern exactly what would be attributable to taxes. But, as we think about things going forward and we look at this next rate case, of course, all else being equal, you may have a slightly lower rate if you were just looking at the tax piece of the decision, in isolation, and there wasn’t some otherwise black box settlement. But again, I’ll just point you back to it’s one of many factors. We’ve continued to make investment in that pipeline over the last several years. We’re going to have some other changing, billing determinants. So, there’s a number of factors. So, I can’t really give you a great insight specifically on taxes, just without thinking about all the other things, and we’ll be making our rate filing here in the middle part of 2018, which that will all come out here shortly.

Next question comes from Christopher Tillett with Barclays. Please go ahead.

Just a follow-up on some of the previous questions regarding NGL volumes. Are you able to quantify at all for us how much the increase in your NGL volumes quarter-over-quarter was due to an increase in ethane recoveries versus just more routine producer activity?

No, we’ve not disclosed that. But, I can tell you, it was through the fourth quarter. Again, as I said a little bit earlier, we started to see some of the facilities where we do have rejection capabilities swing into recovery as prices warranted, but don’t have a specific volume for you.

And then, what about -- are you able to help us think about what you’ve built into guidance for ‘18 on that front, if anything?

I think, our view at the time when we assembled guidance was that we would start to see recovery, be a little bit more broadened through the year, starting through the first quarter and getting on into the second half of the year. So, broadened beyond just the Belvieu plans.

The next question comes from Ned Baramov with Wells Fargo. Please go ahead.

Could you maybe provide the approximate contract split in processing volumes? What percent is POP, keep whole and fee?

Yes, let’s see. I think, I’ve got that number here. We’re about, what, 40%, 50% of that fee base on -- looking at my guides, here’s to get a quick number for you. It’s in the K and that’s the one we don’t have right our

So, on the contract, we’ve got 58% of our inlet volumes in ‘17 were under fee-based processing arrangement, 35% were under COP or POL arrangements and then the balance, that 7% were under keep whole arrangement.

Okay, great. That’s helpful. And then, did you provide the EBITDA contribution from Align? And you’d rather not disclose that, could you just comment on whether it’s tracking in line with the multiples you indicated at the time of the acquisition?

Yes. It is tracking in line. Align is in line with our projections. And what we’ve said on that is we purchased it at a 10 multiple and we would anticipate that being below a 7x multiple by 2020 or in 2020.

You can see, Ned, also, we do have some information in the K where we’ve shown for the Panola plant, the processing volumes that are in there, now granted, that’s on a full year basis. We only owned it for a quarter. But, you can do some rough math that would imply that 100 million a day plan is running pretty close to full. Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Mr. Sailor for any closing remarks.

Thank you. And again, in closing, I want to recognize all of our employees for their hard work and dedication. I want to thank everyone on the call for your interest in Enable. Please have a safe day. Thank you.

And thank you, sir. The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.