Good day, ladies and gentlemen, and welcome to the Q3 2012 NiSource Earnings Conference Call. My name is Leanne, and I will be your operator for today. [Operator Instructions] I would like to advise the parties that the conference is being recorded. And now I'd like to hand over to Mr. Glen Kettering, Senior Vice President of Corporate Affairs. Please go ahead.

Thank you, and good morning. On behalf of NiSource, I'd like to welcome you to our quarterly analyst call. Joining us this morning are Bob Skaggs, President and Chief Executive Officer; Steve Smith, Executive Vice President and Chief Financial Officer; and Randy Hulen, Managing Director of Investor Relations. As you know, the focus of today's call is to review our financial performance for the third quarter of 2012 and to provide a business update. We'll then open the call to your questions. At times during the call, we'll refer to the supplemental slides available on nisource.com. I'd like to remind all of you that some of the statements made on the call will be forward-looking. These statements are subject to risks and uncertainties and could cause actual results to differ materially from those expressed in the statements. Information concerning such risks and uncertainties is included in the MD&A and Risk Factors sections of our periodic SEC filings. And now I'd like to turn the call over to Bob Skaggs.

Thanks, Glen, and good morning, and thanks for joining us. Before diving into the details of NiSource's third quarter, we want to take a moment to extend our thoughts and sympathies to everyone affected by Hurricane Sandy. Our teams were on high alert during the storm, and aside from some minor disruptions, our operations and team members fared well. In fact, there are no major issues with our facilities to report. A big thank you to all of our teams for their focus on safety and to the emergency workers and first responders that braved the storm and are involved in the ongoing recovery efforts. And a special thank you to our crews from NIPSCO and Columbia Gas of Massachusetts that have mobilized to assist with the restoration efforts. And thank you to our financial stakeholders for understanding our decision to reschedule our earnings announcement from Tuesday to this morning. Now to the business at hand. Our agenda today is focused and straightforward with plenty of time for questions. We'll first touch on financial highlights from yet another strong quarter. As you'll see, our earnings continue to be on track with our 2012 outlook. We'll also cover the strong progress we've made across each of our business units, which demonstrates our team's continued execution on NiSource's well-established infrastructure, investment-driven growth strategy. And finally, we'll field your questions. Let's start with a few key takeaways, which you'll find on Slide 3 of the supplemental deck posted online this morning. If there's one theme for the quarter, and the year, for that matter, it's strong progress. Strong progress on our business plan and financial results, strong progress across each of our business units and strong progress on a robust capital investment program. As noted in this morning's release, NiSource's earnings are squarely…

[Operator Instructions] We already have a question waiting, and that comes on the line from Paul Ridzon from KeyBanc.

Hilcorp. Did you -- I just kind of missed -- may have missed it. Did you say the opportunity, currently $300 million, could grow to $1 billion?

That's right. We believe that the downstream infrastructure opportunity, assuming robust drilling and activity in that region in the Utica, could approach $1 billion for the entire partnership. So our share would be about $0.5 billion.

Can I have a sense of the timeframe?

Yes. We think this is a 5-year, 7-year sort of proposition. Again, it's going to depend on the pace of drilling activity in the region.

And your third quarter report indicated some positive preliminary drilling results. Can you just elaborate?

Well, Hilcorp has been active in the area of interest. They drilled a number of test wells. They're looking at frac-ing approaches, tracking approaches. We don't have IP information at this point, but the initial results and tests indicate that we're in the sweet spot of the region.

Where is that exactly?

It's a 4-county area, 2 counties in Ohio and 2 counties bordering in Pennsylvania.

And your next question comes from the line of Charles Fishman for Morningstar.

On the filing last month in Pennsylvania, Columbia Gas filing, would -- is there anything in the filing that's not consistent with Act 11? Or is this pretty much a -- I won't -- I guess it's not a formality, but certainly your expectations would be that everything would be approved. On that matter, is there something that's a little different?

No. It's fully consistent with Act 11, but I'd make this key observation. We're the first out of the gate. So this is going to be the first case that the commission will consider under Act 11. So it will be, to a degree, precedent setting in breaking new ground in that respect.

Okay. And then going to NIPSCO on the transmission. When you said FERC approved your joint venture line with Pioneer, the whole thing has been approved, not just your 50%. Is that correct? Am I misunderstanding that?

That's correct.

Okay. And then with respect to the transmission, is there anything on the horizon that -- additional projects with Pioneer or on your own in that transmission?

Well, the team, the electric transmission team in NIPSCO continues to do a lot of work with projects, in particular in consultation with MISO. So stay tuned for additional opportunities as the months and years unfold. We believe we certainly have the opportunity to increase the portfolio and the investment opportunity as we look at decongesting MISO and providing increased reliability and increased ability to move electrons from the West to the East.

And then finally, on your dividend policy, the 3% to 5% annually. Since -- it looks like your CapEx is running maybe a little ahead of what you outlined previously, which is obviously good if it's good projects. How will the Board look at that next year? Will they -- just because the CapEx is running higher, do you think they might be at the lower end of that dividend growth range? Or was that not an issue?

Well, let me put the policy in perspective. We've said that the payout ratio should be between 60% and 70%. This year, we're going to be right in the middle of that range, and going forward, we'd like to continue to be, give or take, well within in the range. So the Board's going to look at where we stand with regard to the payout ratio. They're going to look at our intention to consistently grow the dividend. And they're going to look at that 3% to 5% guideline that we provide. So they're going to take all those factors in along with where we stand on CapEx, where we stand with the credit rating agencies, and I think they're going to base their decision on those sorts of factors.

And that decision will be made midyear next year?

More likely than not. Last year, we announced our dividend action at the Annual Meeting in May. And again, not speaking for the Board, but I believe that would tend to be the period we'd gravitate to.

We have no further questions waiting at this time. [Operator Instructions]

All right, Leanne. And to the folks that have participated, we certainly appreciate your interest. Thanks for your support, and have a good weekend and a safe weekend. Thanks so much.

Thank you for your participation in today's conference. This concludes the call for today. You may now disconnect. Have a great day.