Welcome to the 2019 Second Quarter Conference Call for Genesis Energy. Genesis has four business segments. The offshore pipeline transportation segment is engaged in providing the 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 segment include trona and trona-based exploring, mining, processing, producing, marketing and selling activities as well as the processing of sour gas streams to remove sulfur at refining operations. The onshore facilities and transportation segment is engaged in the transportation, handling, blending, storage and supply of energy products including crude oil and refined products. The marine transportation segment is engaged in the maritime transportation of primarily refined petroleum products. Genesis operations are primarily located in Wyoming, Gulf Coast States and the Gulf of Mexico. During this conference 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 Ryan Sims, Senior Vice President, Finance and Corporate Development.

Good morning and welcome to all. As mentioned in this morning's release, we are pleased to announce total segment margin of $184.1 million and a calculated bank leverage ratio 4.96 times for the second quarter. Leverage is down from 5.63 times just one year ago. In fact, this is the first time and close to three years where Genesis has achieved a leverage ratio below 5. Despite several unexpected challenges over the previous 12 months, our diverse and market leading businesses continue to perform, allowing us to naturally deliver our balance sheet, a process we believe continues in the coming years. By achieving a bank leverage ratio below 5, we will now benefit from a 25 basis point reduction in the pricing grid associated with the outstanding amounts under our senior secured credit facility. This one combined with the Federal Reserve's recent 25 bps reduction of the Fed funds rate and potential further raising will translate into meaningful reductions in our borrowing costs on our floating rate debt which stood at $967 million that quarter end. In fact, this outstanding debt is down some $340 million from the year ago quarter. We received approximately $290 million for the sale of our Wyoming assets. So over the last 12 months, we've managed to reduce total borrowings under our revolver by an additional $50 million. During the quarter, our offshore pipeline transportation segments have consistent volumes across our asset footprint and continues to benefit from increasing activity in the deep water, including both infill drilling and new standalone development opportunities. The quarter was highlighted by first oil flow in late June from the log operated Buckskin development. Buckskin is a subsea tie back to the existing Lucius production platform and is 100% dedicated for the life of its leads to our SEKCO…

Thank you. [Operator Instructions] Your first question comes from a line of TJ Schultz.

Great. Hey, Grant, this is TJ. I think just first, as you think about offshore, when would you expect to finalize adding some of those dedicated volumes in the 2020, 2022 timeframe? I think you’ve talked in the past about some specific dedicated volumes in 2020 and the 80,000 barrels per day range. So just trying to understand when the next potential bucks can type zero, CapEx time can occur?

I think that again, we gave the estimate, I think in the last quarterly call, I think that we’re basically dotting I’s and crossing the T’s on a number of those. As a practical matter, I mean due to logistical reasons of proximity to our existing systems and the capacity that we have where some of our competitor, pipelines don’t have incremental capacity, I think it’s – there is probability of us not getting to the finish line on a contracted basis is basically zero on most of the things that we mentioned last time. So I do think that we have incremental volumes coming in 2020, and then even larger ones in 2021, especially with towards the end of 2021 or early 2022 with Mad Dog 2 coming on. So our ramp that we intimated and gave some guidance on in previous quarterly calls, I think is still very much impact.

Okay, understood. And then the leverage plan. You talked about getting the four times in the coming years, as you think about your ability to pursue some potential growth projects, whether that’s expansion of soda ash or additional offshore pipes? Just your thoughts on the ability to finance some of this more meaningful growth, should it arise just in the context of your average goals would be helpful? Thanks.

I think that certainly in the offshore when combined with the downstream economics that to the extent that and these are discretionary expenditures, but the aggregate return profiles of what we would be is incremental capital will be spend in the Gulf of Mexico. Again taking into account the downstream economics, there less than five times deal. So including the longer term take or pay to guarantee that if you will not take timing or reserve risk in most cases. So, we view those as in essence financeable under almost any kind of scenario with the flexibility that we have under revolver where we would get material project, EBITDA credit from the strength of the take or pay agreements that we have with people. On the other opportunities in the soda ash business. I think that we have discussed the grinder optimization project which we do believe that at the end of the day on a run rate basis, it’s less than a five times deal. The difficulty there is a little bit that it is a three year construction period. So we would look at other ways to potentially finance that without recognizing that we have a three year capital span and it would kind of bridges if you will to where we’re closer to the incremental EBITDA contribution that we would expect from it the three years once we have idea.

Got it. Understood. Thanks.

Thank you.

Okay, thank you. And your next question comes from a line of Shneur Gershuni.

Actually, Shneur Gershuni but good morning, everyone. Just a couple of quick questions here. Maybe partially to follow-up on TJ’s questions. So when you’re thinking about FID in the project and so forth, are you sort of thinking about like a sales leaseback type of arrangement or some of those JV structures that we saw with target and some of the others? Is that sort of the structure that you’re thinking about? Or are we thinking about it incorrectly?

I’m not sure that we’re precluding any structures at this point. But what we are trying to do is come up with a structure that we feel allows us to start the project, get it under construction, recognizing that there is a three year lag before incrementally, but it does not conflict with our otherwise the leveraging goals. So I’m not prepared at this point to discuss the various structures that are under consideration, but that’s what we’re trying to achieve. Shneur.

Okay. That makes perfect sense. And I think the last time we met that you had noted that you were updating the original expansion plans. I think we’re done in 2013 or 2014, somewhere in that time zone? Has that happened, are the cost materially higher and so forth? I’m just kind of curious if you’ve sort of at least made it through that the revaluation process?

I think that– we’re well into that and that we believe that we’re in the color plus or minus $325 million range in today’s dollars to fully affect the 700,000 time plus expansion of Granger.

Okay. And then just switching gears a little bit here, nice to see the debt balance come down and so forth. You sort of talked about the lower you triggered the lower rate by getting under five times, just given where the 10 years at today, does it make sense at this point right now, to possibly turn out a portion of what’s your facility just sort of take advantage of where rates are today, broadly speaking?

I mean, I think on any kind of historic basis that there’s clearly been a fairly dramatic recovery in energy, unsecured paper. On the other hand, it’s still a couple hundred bits wide where we could price currently in. We do have a fairly clear in our mind fairly clear path forward is paying down continuing to pay down over the coming years’ outstanding revolver. So other than some existing maturities that we think that we could roll and extend by doing an early call on reasonably flat where we – the current coupon on them I don’t see this we’re in a big – there’s a lot of impetus for us to firm out our statements on the revolver.

So you’re effectively saying you’re comfortable with the amount that’s drawn on the revolver today that it just given where commodity prices have shaken, they’ve added a lot of volatility, and so have drilling plans and so forth. You don’t think it’s prudent to take down a little bit further?

We don’t have any concerns about the current outstanding so.

All right, perfect. Thank you very much, guys. Appreciate it.

Thank you.

Thank you. [Operator Instructions] Our next question comes from line of Ethan Bellamy.

Hey guys, good morning. You seem pretty confident about soda ash pricing in the medium and long term. Could you peel the onion for us there a little bit and will that hold if we see worsening globally economic condition?

Yeah, I mean, I don’t know that we are under a significant worldwide recession, but I think that, there could be some reduction and at least the demand growth, but again, we see demand growing. Not necessarily in the EU, the U.S. or China proper, but certainly in Southeast Asia and glass demand as well as lithium demand and in South America. So as long as we have increasing demand with no increasing whether or not it’s 100,000 tons a year, 900,000 tons a year, without incremental natural supply coming on, we still see that the markets very balanced. We’re currently aware of at least two, not inconsequential supply disruptions. So, which are going to be ultimately solved and hopefully for their cycles sooner rather than later, but we certainly see the demand supply balance in the cost advantage of natural production vis-à-vis synthetic production which is currently as a practical matter serving the, the incremental demand is that fundamental is fundamentally isn’t changing in our view at this point.

Okay, that’s helpful. And then in the Marine business, it looks like your utilization is held up and looks pretty good there. Should we expect that going forward and what does the rate environment look like right now?

I’d say that, yeah. We expect the utilization to hold up based upon fundamentals so I think that we’ve talked in previous calls relative to IMO2020 could actually for our style and barge or England barge certainly with the internal heaters could added incremental demand because of getting the right barrel right intermediate refined barrel to the right refinery location to meet the IMO standards. So we think utilization remains high. We are seeing at the margin incrementally increasing spot rates, which I think the litmus test that we’ve actually had some customers talk start talking to us about firming up, which means and how we view that as in their mind, they believe that rates are going to go up so they’re trying to lock in. So I think fundamentally, we feel reasonably comfortable that as we’ve said, we put out a bottom it’s baby steps for the six consecutive quarter in a row. We’ve had marginally improved performance out of the overall side. But so, but we’ve also been cited that we don’t expect it to be running back to 2014, 2015 levels anytime soon.

Thanks, Grant. One last question. Very big picture, there are a lot of assets for sale as an IPO log jam. Do you guys, are you actively looking at the M&A or consolidation opportunities that are out there?

We’re not active and I mean, I don’t make a lot of comments on that. But I would say that we’re we don’t look at things like that. We believe that we are focused on continuing to deliver on our promises and taking advantage of the opportunities that we have off of our existing footprint which we think the return profiles in the long term value creation are far superior to participate in frothy M&A activities.

Good to hear. Thank you very much.

Okay, thank you. [Operator Instructions] There are no more questions at this time, presenters.

Okay, well, thanks everyone and I will talk to you in 90 days or so. Thank you.

Thank you. That concludes today’s presentation. We may ask you to disconnect your lines.