Welcome to the 2018 First Quarter Conference Call for Genesis Energy. Genesis has four business segments: The Offshore Pipeline Transportation Division is engaged in providing critical infrastructure to move oil produced from the long-lived world-class reservoirs from the Deepwater Gulf of Mexico to Onshore Refining Centers. The Sodium Minerals and Sulfur Services Division includes trona and trona-based exploring, mining, processing, producing, marketing and selling activities, as well as the processing of sour gas streams to remove sulfur and refining operations. The Onshore Facilities and Transportation Division is engaged in the transportation, handling, blending, storage and supply of energy products, including crude oil and refined products. The Marine Transportation Division is engaged in the maritime transportation of primarily refined petroleum products. Genesis operations are primarily located in Texas, Louisiana, Arkansas, Mississippi, Alabama, Florida, Wyoming and the Gulf of Mexico. During this call, management may be making forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. The law provides Safe Harbor protection to encourage companies to provide forward-looking information. Genesis intends to avail itself of those Safe Harbor provisions and directs you to its most recently filed and future filings with the Securities Exchange Commission. We also encourage you to visit our website at genesisenergy.com, where a copy of the press release we issued today is located. The press release also presents a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures. At this time, I would like to introduce Grant Sims, CEO of Genesis Energy L.P. Mr. Sims will be joined by Bob Deere, Chief Financial Officer; and Karen Pape, Chief Accounting Officer.

Good morning and welcome to all. We are pleased to announce that we remain on track with our previously announced guidance for visible, achievable long-term distribution growth and a clear path forward to deleveraging. In spite of the 90 day quarter and certain operational hurdles which we expect to be resolved in coming quarters our businesses delivered financial results that provided 1.6 times coverage of our sequentially increased quarterly distribution at the high-end of our guided range of 1.4 to 1.6 times. During the quarter we spent a disproportionate amount of our announced growth capital for 2018. We have successfully commissioned our expansion at the port of Baton Rouge and completed additional gathering infrastructure in the Powder River Basin. This front-end loading of capital expenditures puts us in a position to use excess cash flow in the back half of 2018 to begin repaying borrowings under our revolving credit facility at the same time that we expect to see increasing levels of EBITDA working together to begin reducing our calculated leverage ratio. In keeping with our precedent we won't spend a lot of time on this quarter's results compared to the year earlier period. Rather we will attempt to provide a little color around each individual segment, their quarterly results, and how we view the short, intermediate, and longer-term financial performances of the business. Our offshore results were essentially flat to slightly up sequentially when adjusting for the number of days in the respective quarters. Turnarounds and certain delays beyond our control and achieving producer provided forecast were the main drivers in slightly underperforming even our internal expectations. Although we have been told to expect certain other extended producer turnarounds in the second quarter, we continue to believe the overwhelming majority of physical underperformance in any particular 90 day period…

[Operator Instructions]. And your first question comes from the line of Theresa Chen with Barclays.

Good morning. Grant my first question is related to your comments about the crude lease purchasing business have never been a significant contributor, so it was 1.2 per quarter in 2017, can you tell us how much it was, what's the number in 2013-2014 at the peak?

I don't have it directly at my fingertips but I think in 2014 it was around $30 million at most.

Got it, and in terms of the onshore business as a whole looking past the noise, what's a good run rate for this business currently and how much EBITDA contribution from the $700 million of CAPEX spend over the past few years has already been phased in and how much EBITDA do you expect will phase in going forward?

I don't know that we've really kind of broken it out in that way. At this point I would say that we're currently hitting on basically the minimum volume levels. As for instance when we're talking about the downstream issue on the Texas system which is kind of beyond our control, early in the fourth quarter we were actually ramping and exceeding minimum volumes by order of magnitude almost 25%. And then this downstream top line development occurred. And so we're back to collecting if you will the MVC amounts until it's resolved. So long story short we continue to little of it or call it at most MVC are taking high levels or kind of currently being reflected. But we certainly expect the actual commercial usage to significantly exceed those levels and to ramp throughout the rest remaining part of the 2018.

Got it, turning to the soda ash business, can you explain the synthetic production facility in Eastern Europe that you mentioned, can you give us any color on how much product that it produces every year and when do you think it will be open?

The notional annual capacity of the facility is 350,000 metric tons. And so we do not have any first-hand knowledge of how long it will be off as a result of the incident but again as we kind of pointed out and tried to frame it within the discussion, our perception is it were much better as we see the market today than kind of what we anticipated even nine months ago or ten months ago when we acquired the operation.

Understood and lastly just out of curiosity the certain transaction cost at $1.7 million in the build up for total select items, is it mainly related to like integration costs for a soda ash because in the footnote it also says it includes money spend in advance of other acquisitions just to call that out specifically quarter-over-quarter, are you planning to buy something else?

It is specific but virtually all associated with the ongoing integration of the soda ash operation.

Got it, thank you very much.

That covers it Theresa.

Thank you very much.

Your next question comes from the line of Jeff Birnbaum with UBS.

Hi, good morning guys. Just wanted to continue the discussion on the soda ash business, first off can you remind us of the multi-year domestic contracts with pricing mechanisms that you have in place for the soda ash business, wondering if you can talk about duration, percentage hedged as well as kind of what the upside and downside is on the pricing mechanisms?

Most domestic contracts are in let's call it the one to three year and probably weighted towards the two plus years almost three years and have particular powers that often are plus or minus 2% or so kind of at the wide end of how we do things. So, it provides a certain amount of stability and price stability both from our perspective as well as for the consumer's perspective we are having because it's obviously it's in general it's an important input cost into their operations. So the international transact prices or contracts are typically of a shorter duration I would say. In certain areas where transact markets primarily other parts in the Americas are probably in the one year time frame with either fixed prices or even quarterly redetermination within the cards. The contract structure in Asia ex China is probably a shorter duration. In some cases one month price redeterminations but typically outside probably quarterly.

Okay, and just sort of following up on your comments about the overall global soda ash market. I was wondering if you can sort of talk about the impact of rising oil prices. My understanding is that the some of the higher cost producers are very sensitive to the price of oil in their cost structures, can you sort of talk about the impact on your business relative to global businesses and could we view rising oil prices as a positive price pressure for soda ash in general as to how it impacts the higher cost producers?

I think it is not necessary oil prices or rather power prices, the synthetic production was a very power intensive process And so yes, it as a proxy for power prices going up to the extent crude oil or LNG prices or however you want to characterize it is rising that is undoubtedly affecting the cost structure of synthetic productors along with ammonium and sodium chloride and the other kind of chemical inputs into the synthetic processes. So and given that we're already has been the largest producer of natural soda ash in the world and having one of the -- because of the natural production one of the lowest cost structures that improves our relative competitive position in synthetic -- competing with synthetic production on a worldwide basis.

Okay, fair enough. Sort of continuing on you talked about how CAPEX is front-end loaded this year and you have the twin benefit of lower spend and rising EBITDA improving your leverage metrics towards the end of the year. Any thoughts you have using some of the excess retained cash to not only pay down debt but also to potentially buy back shares or units rather?

I think that that's something that the Board would consider on a prospective basis that we're intent first and foremost getting our leverage ratio down to 5 or below. And we would -- we believe that everything else is saying that that's the highest value you would use or excess cash. And as we said we anticipate being close there by the end of this year. And -- but I do think that given where we are, that that is certainly a possibility of unit repurchases at some point down the road once we have addressed the leverage situation.

Okay, and just one final question, with respect to the Gulf of Mexico a lot of positive commentary you had out there, you talked about agreeing with EIAS [ph] I think Shell recently FIDed FIDO. Can you give us some sort of sensitivity as to how you think this positive outlook for the Gulf of Mexico will impact your business, how much capacity do you have to be able to handle this rising production?

Again I think that if you look at our operating statistics that are provided in the press release and I will return to them real quick but Poseidon in the quarter was running at 239 kbd. I think that it pretty comfortably can move 320 shots was right around 200 kbd. Under current configuration it can comfortably run 350 kbd and ultimately it could be expanded to 500 plus with additional punch. So I think that sure the message is, is that we have the existing capacity that is we kind of try to always emphasize it for no incremental capital required to us, that we have significant leverage, EBITDA growth leverage out of the Gulf of Mexico. As more infill development drilling is occurring, more subsea tie back is occurring and then more sanctioning of standalone projects. I mean just to do the math around Mad Dog 2, I mean that's basically spending no money to lease the design capacity in the facility, its $50 million a year of incremental EBITDA to us.

Okay, and certainly it is fair to say there is plenty of operating leverage at -- capital?

Correct.

Perfect, thank you guys, really appreciate the color and enjoy the weekend.

Thank you.

Your next question comes from the line of Eric King [ph] with Citibank.

Hi, good morning. I just wanted to get you to expand if you could a little bit on Louisiana I think with all the challenges and uncertainty around some of the Canadian pipeline expansions and what is going on with WCS. What are some of the signposts and when do you think you're actually really start to see more happen around Louisiana? And should those be linked?

Yeah, I mean again if we think it is a little back loaded in the year. I mean I read a headline yesterday that the premier of Alberta is meeting with the two primary class one railroads. The CN and CP at some point try to figure out what is required to increase the rail volumes coming out of Canada and we are trying to help debottleneck the overall situation. So our view is, is it certainly hopefully starting in the third quarter and accelerating into the fourth quarter based upon indications from and again I want to emphasize we're not involved in the trade we just get paid a fee for unloading it. But we would anticipate the volumes to kind of meaningfully start ramping and sometime when the third quarter and hopefully accelerate into the end of the year.

Okay, so just kind of I think you also mentioned there was a refinery turnaround, should we be watching more of the rail side, the refinery turnaround sort of being finished or both?

I think it's really going to rail volumes are what is going to ultimately drive the increased margin contribution out of the investments in Louisiana both from consumption at the refinery itself but ultimately because of our development and expansion of our true handling capability on behalf of Exxon Mobil at the port of Baton Rouge we would anticipate ultimately seeing the increasing ex potential increase in exports out of the port of Baton Rouge.

Okay, I just want to ask you about leverage. I know few stresses on this but it looks like you're sitting right near your covenant at this point time so if we kind of think 2Q was another sort of kind of low quarter before you get to this point are you likely to violate your bank covenants and what happens in that scenario, I assume it is fairly straight forward in terms of addressing that but would like to…?

It's not likely that we will highlight our bank covenants as the covenant is 5.75 times through the second quarter. And it drops down to 5.5 times in the third quarter and thereafter. So, we have no concerns of getting into a volatile situation. I think that if that ever becomes a concern that I think it's a simple majority vote of the banks representing the committed capacity of the revolver if we wanted to get an extra order turn for another quarter or two as we embark upon our natural deleveraging.

Okay, and I think the lesson for me as you were looking at it and you kind of talked about your deleveraging goals in the past, you were saying you wanted to be approaching 4.75 by the end of this year and that probably -- I would assume that that probably is kind off the table. So what sort of neighborhood do you think you can be by the end of this year on a trailing basis and would it change and do you get closer if you say okay, well fourth quarter we annualized fourth quarter and not just look at trailing 12 months and then we are there, I mean how do you think through those targets that you provided now?

Well first of all the target at the end of this year was 5 not 4.75 and it is going to 4.5 at the end of 2019 or the end of 2020. We think that when we talked a little bit about this on the fourth quarter call because of our decision to increase investment in Wyoming that getting all the way to 5 by the end of this year may be a little bit challenging. But we believe that we're still consistent with being able to get to the 4.5 at the end of 2019 and 4 below by the end of 2020. So we don't think that there's any issue there and then I agree -- that's on a trailing basis in the way we would calculate it, presented in our filings as well as our bank compliance. But yeah, I think if you -- we would certainly believe that annualizing the fourth quarter on any kind of run rate basis that we would be under 5.

Okay, thank you.

Your next question comes from the line of Jared Blashki [ph] with MUFG Securities.

Hey guys, just a couple of questions, hope probably haven’t been asked, any increase in marine volatility with the roll off of the last of the legacy contracts?

No, I think as I said that that room believe it or not I mean when you reprocess from $27,000 a day to $15,000 a day which is a spot market for that type of vessel. Then you know it had a $1.2 million sequential negative but kind of offsetting that was actual bottoming on the inland side and the brown water side. Utilization continues to be very high so and everything else is the same, it kind of appears that we're seeing at least for our particular type of internal heater barges reasonable stability in the spot values for that. So as we try to say in the prepared remarks I mean I think it's -- we're hopeful that we've put in a bottom but we are not being -- we're not going to be pollyannish and think that things are going to turn around very quickly. It's going to take a while for there to be an efficient rationalization of demand and supply in the marine business.

Okay and then any other turnaround you're seeing on the horizon or things that could kind of be negative or detract us from the onshore lines?

Nothing that we're aware of at this point. Again it's Texas volumes are going to be dependent upon when the downstream pipeline has resolved its operating conditions and we talked about what we think is going to be the major contributor drivers in Louisiana.

Okay, and then last one and this is really just a housekeeping to have it on record, any impact from the front policy change?

As we put out intraday when the units were down 10% as a result of that, less than 5% of our total segment margin is generated by assets that are even under further jurisdiction. And even though we said less than 1% it's really less than 1/10th of 1%. Our segment margin is generated by anything that is akin to a cost of service rate making. So, it's kind of like bad policing that's searching first and ask questions later.

Okay, thank you.

[Operator Instructions]. Your next question comes from line of Patrick Wang with Baird.

Hey, good morning Grant. My first question is on the marine business. It looks like barge utilization has settled into a stable to recovering range and you mentioned in your prepared remarks that would likely mark the bottom there, does not comment apply to both utilization and pricing and specifically do you see any further risk around spot rates from here?

I think the utilization is -- yeah, it seems quite good and has continued into the second quarter. As I think I mentioned on an earlier response, actually seen a stabilization if not extremely modest increase in spot rates. So the combination of that is seemingly is a good thing but again we're not projecting any kind of rapid recovery.

Okay, understood and then just moving to the soda ash business looks like that delivered another solid quarter here and your outlook does sound positive, can you talk through your outlook for the balance of the year and help us and investors better understand what the CAPEX needs and the timing for those needs are on this business?

Yeah, I think that we had previously guided that 2018 we would anticipate a 155 range of 155 million to 165 million of segment margin contribution for the soda ash operations. I think we tried to intimate in our prepared remarks that based upon how we feel today that we would certainly be to the high end of that range. On a run rate basis combination of maintenance capital as well as growth capital and growth capital we define at the base of alkali operations of primarily debottlenecking type capital spend to generate to give us the ability to produce more soda ash and therefore have an incremental revenue stream out of the same footprint. The combination of that on a run rate basis is order of magnitude in the $40 million a year rate. And from any given year sometimes that can be 60% growth capital and 40% maintenance or vice versa. So I think again we think that there is a tremendous business, a long line of business, very stable and given our kind of market position both domestically as well as internationally we think it was a very attractive opportunity for the partners.

Hey, got it, makes sense. That's it for me. Thanks.

Okay, thank you.

And there are no other questions at this time.

Hey, very good. Well that's the end of our prepared remarks and we will talk in another 90 days, thank you.

This concludes today's conference call. You may now disconnect.