Keyera Corp. (KEY) Earnings Call Transcript & Summary

Good morning. My name is Lara, and I will be your conference operator today. At this time, I would like to welcome everyone to Keyera's 2023 Year-End Conference Call. [Operator Instructions] I would now like to turn the call over to Calvin Locke, Manager of Investor Relations. You may begin.

Thank you, and good morning. Joining me today will be Dean Setoguchi, President and CEO; Eileen Marikar, Senior Vice President and CFO; Jamie Urquhart, Senior Vice President and Chief Commercial Officer; and Jarrod Beztilny, Senior Vice President, Operations and Engineering. We will begin with some prepared remarks from Dean and Eileen, after which we will open the call to questions. I would like to remind listeners that some of the comments and answers that we will give today relate to future events. These forward-looking statements are given as of today's date and reflect events or outcomes that management currently expects. In addition, we will refer to some non-GAAP financial measures. For additional information on non-GAAP measures and forward-looking statements, please refer to Keyera's public filings available on SEDAR and on our website. With that, I'll turn the call over to Dean.

Thanks, Calvin, and good morning, everyone. Keyera delivered record results in 2023. We continue to execute our strategy of increasing competitiveness, enhancing and extending our integrated value chain, financial discipline and sustainability leadership. Results include best ever safety performance and exceptional financial results driven by record realized margin across all 3 of our business segments. Keyera ended the year in a strong financial position with net debt to adjusted EBITDA at 2.2x, below our targeted range of 2.5x to 3x. We had several strategic accomplishments in 2023 that helped drive the next phase of growth for Keyera. Early in the year, we closed the acquisition of an additional working interest at our core KFS complex, adding meaningful fractionation capacity in a high-demand market. In the spring, we brought KAPS online, strengthening our long-term competitive position. We now offer Montney and Duvernay producers a fully integrated solution that's driving commercial success across our value chain. Today, we announced that we've added long-term integrated agreements with several producers. This includes approximately 30,000 barrels per day of incremental volume commitments on KAPS and 33,000 barrels per day of incremental and extended fractionation commitments at KFS. These have weighted average contract terms of 12 and 13 years, respectively. These integrated agreements also includes storage at KFS and other services like rail transportation, pipeline connectivity and product marketing. These contracts are highly -- with highly creditworthy counterparties include a high degree of take-or-pay and require minimal additional capital. Keyera delivered record fee-for-service growth in 2023 with best ever contributions for our gathering and processing and liquids infrastructure segments. Continued growth from Wapiti, Pipestone, KFS and KAPS support us reaching the upper end of our EBITDA growth target of 6% to 7% from 2022 out to 2025. The new commitments we announced today support continued growth beyond 2025. Our Marketing segment delivered a record $479 million of realized margin in 2023, driven by record sales volumes for the segment and continued strength of our iso-octane business. Our ability to leverage our physical assets and logistics expertise provides us with a distinct competitive advantage and deliver strong cash flow. This marketing margin is then reinvested into long-life infrastructure projects. In turn, driving growth and high-quality fee-for-service cash flows. As we close out a successful 2023, we're excited for the year ahead. 2024 is anticipated to be a year of strong free cash flow generation resulting from continued margin growth and lower capital spending relative to the past several years. Our capital allocation priorities remain the same. They are first to maintain the strength of our balance sheet and then the balance between increasing returns to shareholders and investing in additional growth opportunities. Fractionation expansion opportunities at KFS and the KAPS Zone 4 expansion are great examples of capital-efficient opportunities that support our growth outlook beyond 2025. Our strong balance sheet provides maximum optionality to bring forward growth investments when they're ready. Lastly, you would have seen in our release this morning, that we'll be taking AEF offline this spring for approximately 6 weeks to proactively complete maintenance activities. These maintenance activities are intended to facilitate AEFs continued reliable operations at full capacity until its next scheduled turnaround in 2026. The work is expected to impact 2024 realized margins for the Marketing segment by approximately $35 million to $45 million with no impact to maintenance capital. Due to strong near-term market fundamentals, we still expect to be within our stated base marketing guidance of $310 million to $350 million for 2024. Consistent with prior years, we'll update our 2024 marketing guidance with Q1 results in May. This will include the impact of this outage. I'll now turn over to Eileen to provide a further update on our quarterly and annual financial performance.

Thanks, Dean. Adjusted EBITDA was a record $339 million for the quarter and a record $1.2 billion for the full year, compared to $212 million and $1 billion for the same period last year. Distributable cash flow was $234 million or $1.02 per share for the quarter compared to $104 million or $0.47 per share for the same period last year. DCF for the full year was a record $855 million or $3.73 per share compared to $654 million or $2.95 per share for 2022. These results were driven by record contributions from all 3 business segments. We recorded net earnings of $49 million for the fourth quarter and $424 million for the full year 2023. This compares to a net loss of $82 million for the fourth quarter and net earnings of $328 million for the full year 2022. The 2023 results include a noncash impairment charge of $210 million related to the Wildhorse Terminal. The 2023 dividend payout ratio was 53% of DCF at the low end of our target range of 50% to 70% and corporate return on invested capital for 2023 was 16%. At year-end, we had over $1 billion of available liquidity and in January of this year, we issued $250 million of 30-year notes at a coupon rate of 5.66%. Looking forward, our 2024 guidance remains unchanged. Growth capital expenditures are expected to range between $80 million and $100 million. This includes about $60 million of sanctioned capital for various optimization projects, with the remaining $20 million to $40 million contingent on the sanctioning of KAPS Zone 4 and fractionation capacity expansions at KFS. Maintenance capital expenditures are expected to range between $90 million and $110 million, of which about $20 million is recoverable in 2024 and another $15 million is recoverable within the next few years. Cash taxes are expected to range between $45 million and $55 million. Thank you, and I'll turn it back to Dean.

Thanks, Eileen. Demand for Canada's energy has never been stronger. Our basin set new records for both natural gas and crude oil production in 2023. The Trans Mountain pipeline expansion and LNG Canada support the next phase of basin growth. Keyera is positioned to participate in a meaningful way. On behalf of Keyera's Board of Directors and management team, I want to thank our employees, customers, shareholders, indigenous rights holders and other stakeholders for their continued support. With that, I'll turn it back to the operator for Q&A.

[Operator Instructions] Our first question is from Rob Hope from Scotiabank.

The first question is on the KFS contracting. So the 33,000 barrels a day would be, we'll call it, half the propane plus capacity, assuming that the volumes are propane plus. But where do we stand on the remaining capacity at KFS? And with this incremental contracts at hand now, does the contracting strategy then turn to the expansion?

Rob, thanks for your question this morning. Obviously, we're very pleased with our contracting and how that's really integrated with our KAPS pipeline project again, allowing us to be able to deliver integrated service offerings to add value for our customers. And certainly, we haven't -- for commercial reasons and commercially sensitive reasons, we haven't disclosed how much of our capacity is locked up. But certainly, this helps support future expansion. And -- anyway, that's a key part of our integrated infrastructure at KFS asset. And maybe I'll just turn it over to Jamie, if he wants to add any other comments?

Yes. Thanks, Dean, and thanks, Rob, for the question. So as we think about expansion, it's really driven, as you pointed out, around demand for frac capacity, both in the near term and the long term. And as you noted, with our additional 21% working interest in KFS. That's really given us an advantage in the market to be able to go out and contract long term because we've got capacity available in the short term. So there's a couple of ways that we're looking at expanding our frac capacity in Fort Saskatchewan. Our most capital and time-efficient option is to pursue a debottleneck of frac 2, and this allows us to take advantage of existing equipment, so the per barrel cost of incremental capacity is more favorable. And also, we're looking at further capacity expansions by building out frac 3, which would be a new build on our existing lands. So we're also actively evaluating the best way to proceed with this project, and we'll update as appropriate. But it's really important to note that this isn't an either or or. If you think about it sort of as a build as we increase our frac capacity, the debottleneck would then lead into a potential frac 3. But -- so they're very exciting opportunities for us. I'll just remind you and the listeners that it's subject to appropriate customer underpinning and board sanction.

Appreciate that. And then maybe keeping on the contracting themes, good to see some incremental contracts on KAPS. Can you maybe just give some additional color on where we are in further discussions with customers on increasing that percentage contracted even further, as well as how the Zone 4 contract discussions are going, especially given the fact that a BC pipeline now has regulatory approval, although it's not yet sanctioned?

Yes. No, we're having great conversations with our customers. And obviously, we're also very excited about the growth in the basin. When you think about LNG Canada finally coming into service in the short time period, we think that's going to unlock growth in the basin. And when you think about global demand for LNG, we have a tremendous opportunity off the West Coast of Canada. So I certainly expect that there's going to be further expansions below phase one of LNG Canada. So really, what that means is that there's going to be a lot of growth opportunities in the basin, and we're very well positioned. So the contracts that we announced, again, integrated contracts for our services. We are in active discussions with other producers to continue to add more volumes to our system. And in addition to that, with the growth we see, we think that there's going to be a lot more volume added in the years to come. In terms of Zone 4, certainly we believe that there's going to be development along the entire Montney fairway into BC. So we'd love to build our pipeline to the border. It's great that NorthRiver Midstream received federal approval for that connected across the Alberta BC border. So that's a tremendous milestone over 3 years of work on their behalf. So I congratulate them on the great work they did to get that approval. And for all the reasons why producers were supportive of KAPS Zone 1 to 3, those same reasons apply to Zone 4 and into BC. And that's that they want optionality of their transportation of NGL service. They want competition. And again, it doesn't hurt to have a new pipe in the ground in terms of overall reliability. So we're very happy that we can provide that competitive alternative for our customers. We're here to add value for our customers. And I think that we have a great opportunity to do that for them. And if we do a great job of it, we'll also create value for our stakeholders as well. But Jamie, is there anything else you want to add on that?

No. I think you hit the nail on the head.

Maybe just lastly, our KAPS, I just want to remind you that our guidance is now at the high end of the range, so 7% EBITDA growth out to 2025. And the contracts that we announced and again, some of the deals that we're working on going forward will help deliver growth beyond that 2025 time period. So we're very excited about it.

We have our next question coming from the line of Robert Kwan from RBC Capital Markets.

If I can just start with questions on capital allocation and capital efficiency. You mentioned the #1 priority is balance sheet strength and just where debt-to-EBITDA is like you're already there, below your range. So are you rethinking the nature of that range, particularly just where investor feedback is and trying to prepare for future CapEx, and we should expect that you want to be below the range or that you're going to move the range? And then the second part is just on capital efficiency, and how do you define or think about what capital efficient is? And just the idea trying to understand your approach to projects and major projects [ ending ]?

Yes. Maybe I'll just add a couple of comments, and I'll pass it over to Eileen, Robert. But thank you for the question. And I'll just state the obvious that we're in an enviable position that we just delivered our best year ever. And our balance sheet is also in an unbelievable strong position. So it gives us a tremendous amount of optionality for us to pursue opportunity, and we see a lot of opportunity across our entire integrated value chain, especially when you overlay the growth that we see coming in our basin over the next several years. So again, we're very pleased with the position that we have. And so -- with that, I'll just turn it over to Eileen, and maybe she can add a few comments as well.

Sure. Thanks, Robert. Yes, it's a great question as it relates to the balance sheet. I think to answer the question, it's really important to note that the 2.2 leverage at year-end included record marketing results. So once you normalize marketing to even the high end of our new base, so say the $350 million. That leverage ratio is at 2.5x, which is at the bottom of our target range. So I think the key message here is that we are very comfortable remaining at this range. The balance sheet provides us optionality, as we said before, to pull forward growth spending. And as Dean alluded to in his comments, we have several exciting opportunities, Zone 4 frac expansion. So based on where the balance sheet is today, we feel comfortable that we could fund these types of opportunities on a self-funded basis. And maybe the capital efficiency question, I think maybe Dean can add to it. But I think we really look at how are we adding projects to our existing value chain and looking at the fully integrated returns, not in the whole system. And I think that's where additional frac expansions and extending KAPS to Zone 4, those are certainly more capital efficient.

On that -- sorry, go ahead, Dean.

I was just going to say, I mean, obviously, a big part of our capital efficiency, too, is just having the financial backing to make sure that we can deliver strong returns for our stakeholders as well. So that's a key part of our strategy and how we deploy capital. But sorry, go ahead and ask your question.

So yes, so there's a bit of that. Just -- you've had that old range of 10% to 15%. You've talked about wanting to be towards the high end. So presumably, that's kind of what you're getting at around being efficient, you want your returns at that high end. Jamie also talked a little bit around smaller projects or time-efficient projects. Is there a bias to trying to take on smaller initiatives that can be done quickly? Or is there still an appetite for a KAPS like? And I don't know what that project would be, but to take on a larger project that would be a multiyear build.

Yes. I think those are great questions. And first of all, say that we're here to provide a very competitive and efficient service for our customers. So we look for opportunities to be able to provide that service offering for our customers. And we're also about adding value for our shareholders and on a per share basis. So that's how we think about value. It's got to be value accretive. When we think about individual projects, we do look at large projects and small projects, too, because there's a number of smaller projects that -- but generally, our small projects have to have a very high return and that's to compensate for the resource allocation that we would dedicate to those types of investments. Generally, they're ones that we can turn around on a shorter time period versus the big projects that might take -- have a 2- to 3-year development and build cycle. So there's always a combination of both that we're pursuing. I think the one thing that's exciting to you about our small projects is that Jarrod's team has identified a number of emissions reduction opportunities that also have really great economics. So we're also satisfying our goal of reducing our overall emissions and achieving our 25% intensity reduction goal by 2025.

Got it. If I can just finish on marketing, and I know you're going to update your guidance. But just if we can deconstruct 2023, just where the market is, like I think you mentioned that you put a record year. There was actually a slight loss on hedging. So hedging wasn't really a driver. If anything, it's just the upside. Can you just talk about what you're seeing though, the butane market right now? And in 2023, how much of a benefit did you get from [ conde ]? Do you see that as onetime just with Trans Mountain coming in and oil sands growth? Would you see that as continuing? And then how much might have been a benefit from the [ E15 ] rules, although those may get rolled over as well? What was unusual in 2023 that people shouldn't be thinking about as carrying over into the '24 and beyond?

That's a lot of questions, Robert. First of all, I'd just say in general terms, obviously, we had a record year. And we benefit from volume because we're a volume times margin business. So as the volume to our systems grow, our downstream marketing business will benefit as well. Our iso-octane business has been very strong, and Jamie can speak to some of those factors that contribute to that. But I also want to say that you also touched on hedging, and I do want to remind everyone, even though that we have great marketing results, we have a very disciplined hedging strategy. In our team, we have a team of executives, and our marketing team that meet every week and we go through all of our positions. And so we want to always make sure that we're preserving margin, and we're not trying to swing for the fence to also expose yourself to big losses as well. So that's all part of our overall marketing margin strategy as well. But with that, I'll turn it over to Jamie for his comments.

Yes. So Robert, I was feverishly jotting down your question here. So hopefully, I hit all the points that you were asking for. I think the first thing that you were inquiring about was our butane cost. So as we look at butane right now, I think we look at the market as being in a relatively similar place as last year. But it's early days within our supply season and ultimately what we would be able to contract for butane. And to remind everybody, in 2023 butane was in probably the mid-range of slightly lower than what we would have seen in a 5-year average. So it wasn't like it was an extraordinarily inexpensive butane market in '23. So that really goes to the next question, the condensate you inquired about. As I look at our condensate business, it's really driven off of the assets that we have and that we've invested in over the years. And so with condensate's contribution sort of a onetime thing in '23, I would say not because that business is driven off of the assets that we have in the ground. And the service that we provide and remind everybody, we do touch over 70% of all the condensate that ultimately gets delivered to the oil sands in Western Canada. So we have very, very enviable assets on the condensate side. On the iso-octane side, what we're seeing around the premiums that we're receiving for iso-octane and also RBOB pricing is that we continue to see good fundamentals on a supply-demand perspective for gasoline within North America and also for octane. So continue to see lower imports of octane blend products coming into North America, and with new gasoline regulations in the U.S., in particular, we're seeing less octanes being produced and ultimately, therefore, a higher demand for our product should be able to top up, if you will, the octane requirements for gasolines in North America. So those are all things that contribute to our guidance, our base guidance that we communicated in the latter part of '23. I guess the last point I'd make is that the marketing team has done a very, very good job as well of accessing better, more lucrative advantaged markets for iso-octane over the last couple of years. And once again, I think that's really driven by some of the change in regulation and gasoline and ultimately, a demand for iso-octane in those jurisdictions. So that all rolled together is sort of the backdrop for what we see in '24 going forward. That pretty much sums it up in a fairly long-winded manner.

We have our next question coming from the line of Ben Pham from BMO.

A couple of questions on KAPS. I'm wondering if the contracts that you've announced, do you think you could have been able to secure those contracts if you didn't have the KFS deal and optionality that you had?

Ben, that's a great question. I think independently, there's a lot of demand for, again, a competing ultimate transportation service for NGLs on a stand-alone basis. So I think that, that asset stands on its own and again, evidenced by the contracts that we signed. But I can say that we're very active in adding to that contract base. So it's good demand for that. I would say that overall, with our integrated system now across the Montney is that it enables us to provide a bundled service offering. And I think it's a more efficient service for our customers, which, again, will -- it's a one-stop shop that will help add value for them. And for that reason, we're able to leverage other parts of our integrated value chain, including our G&P business, and also our downstream fractionation, storage and marketing business. So it's really complementary to our integrated value chain, and that's why you're seeing integrated deals and expect to see more of those in the future.

Okay. Got it. And are you able to provide a bit more context on the messaging around the 10% to 15% return on KAPS getting pushed out beyond 2020 -- sorry, 2025?

Yes. No, it's a great question. We're still not in the range, but I can say that this certainly takes us in the right direction. And as I mentioned before, we're in active discussions to add more contracting. So we feel pretty good about how that's looking. And again, I do want to emphasize to your earlier question that it really helps us provide an efficient service for our customers to basically sign a fully integrated deal with them, which helps generate strong returns at enterprise level, and we think that's a big advantage for us.

Okay. And can you remind me too on Pipestone? You had the bottleneck and things are going pretty well there. Can you remind -- is there some sort of operating agreement there that is going to expire? Is that on something else now? How do you see that shaking out from your perspective?

Ben, great question on Pipestone. And we're very pleased that, that project came in under budget. And actually, before on schedule or actually before the scheduled in-service date. So it's great that we brought in service in Q4. There is a lot of gas that was waiting to be processed. So basically, we're using the full capacity of what we just added, which is fantastic. We do have an option to take over operatorship and that basically option exists after 5 years of being in service. So that's something that we'll be addressing in the future. I should mention though, on Pipestone though we do have -- we are the commercial lead on that project. So we're the ones who contract incremental volumes through that facility. We just don't physically operate it today in the field. But we do have some of our ops folks that are very integrated with that facility.

Our next question comes from the line of Zack Van Everen from TPH.

Perfect. So it sounds like Pipestone is running near capacity even after the expansion you guys brought on. Are there other opportunities you're looking at there? Or can you push incremental volumes to maybe less [indiscernible] around the area? Just trying to get an idea of how much more growth you can see out of that.

Yes. No, thanks for the question, Zack. And we're very fortunate to have a footprint in a highly economic area of the Montney it's very condensate-rich and which really drives a lot of strong economics in that area. So we see a lot of demand, but maybe I'll turn it over to Jamie for his comments.

Yes. So just to supplement that a little bit is with the Pipestone debottleneck and then ultimately, the expansion that came online at the back end of last year, that's fully contracted with high take or pay, but it is a very active area. So we had announced last year that we were looking at a further expansion of Pipestone, and we still continue to work with producers in the area to see whether we can get the volume commitments to be able to pursue that opportunity. The ability for us to be able to shift volumes around to ultimately other facilities, such as Wapiti or Simonette, is it has a limited -- we have a limited capability to be able to do that. And what I would say is I also think that the geology and the activity around both Simonette and Wapiti would support them getting to very high utilizations in the very near term regardless.

Got you. That makes sense. And then kind of shifting downstream a little bit, the fractionation facility saw a pretty big jump this quarter. Are you pretty maxed out on fractionation capacity as well at this point? Or do you have a little bit more operating leverage there?

Our fractionation demand is very high. So we are operating at pretty much full capacity. I would remind you that the 21% of CapEx that we acquired last year, really helped us because we acquired more frac capacity at a time when it's needed the most. And that's actually helped us leverage into some very long-term contracts as well at that complex. As Jamie mentioned, we're working on expansion to you for the future to service the basin.

Our next question comes from the line of Patrick Kenny from National Bank Financial.

Just on the write-off of the Wildhorse Terminal. I assume you had very little, if any, contributions from Cushing baked into your base marketing guidance. But just wondering if we extrapolate the fundamentals around crude oil blending from down south, up to your Canadian operations, especially with the outlook for tighter heavy differentials once TMX comes online? Any thoughts around how you're looking to maybe reposition your overall tankage and crude oil marketing portfolio, just to help mitigate some of these structural macro headwinds?

Pat. It's a good question on Wildhorse, and I'll turn that over to Jamie.

So that's -- thanks for the question, Pat. Yes. So the structural forward curves of crude oil with the backwardization that we're seeing right now, it's just -- it's really a challenge to justify high tankage fees for that type of opportunity. Having said that, that backwardization and the higher crude prices that we're seeing and enjoying right now as an industry, is also beneficial to Keyera's other components of its business as well because we price iso-octane off of crude and are above crack off of that. But back to the storage business that we have done in Cushing. That -- we're not a huge crude player, and that asset was viewed as an opportunity for blending. And it just frankly hasn't panned out the way that we expected to over the first few years of operation. Not to say that at some point as the forward curve shifts, that, that asset won't have it today. But -- and as we look at it from a Western Canadian perspective, once again, to be repetitive, we're not a big crude blender. We have an interest in BTT, but really, that asset is more of an enabler for crude to ultimately go into other pipes certainly will be benefited from the Trans Mountain expansion that we're hopeful that will ultimately be in service shortly. So -- and that's not as we talk about our core business, it's probably not an area that we would look to get a further position in.

Okay. Great. Jamie, and then maybe 2 just on the propane side. So looking at supplies continuing to grow in both Canada and the U.S., but just in light of consumption being down this winter. You guys mentioned the disciplined hedging strategy on the margin front, but just wondering if there's any concerns around physical sales volumes being down, say, for Q1 just given the warmer winter and the higher inventories that we're seeing across North America?

Yes. So yes, great question. I think as we think of propane is that we think about really export. North America is very well positioned to be able to clear product out of the Gulf and as we see opportunities on the West Coast of Canada, we really do view that export capability is always going to allow propane to -- and the producers that ultimately have that as being one of their products to clear into markets that are going to justify the cost to produce and ultimately fractionate the propane. So that's our view. I think we've certainly seen a run-up in propane in the last little while. And as you point out, not driven off of North American demand but frankly, global demand.

Yes. I think maybe just to add to that as well, Pat, is that our strategy has also been to have optionality to be able to hit multiple markets. So we do deliver locally to the industrial market in Alberta. We're pipe connected to IPL's PDH facility. We delivered some to the West Coast, but we also deliver some in the United States. And again, the highest priced market varies over time. So right now, it's really helping us having that optionality in the physical assets to be able to deliver to all those markets.

Our next question comes from the line of Will Gu from CIBC.

Just wondering if there are any plans to grow volumes at [ AEF ] from here? And what would that look like? Would it happen perhaps during a future turnaround? Or any comments around that?

Yes, it's a great question, Will. And obviously, that part of our business is very lucrative for us. And what I can say is that over the last 3 or 4 turnarounds, our teams found ways to just create small debottlenecks. So we can operate that facility above nameplate capacity. And we've been operating as high as 110% of nameplate. So I think that's really great because every barrel we produce in that facility generates a lot of margin. But maybe I'll just turn it over to Jarrod to comment on what he sees about the future for that facility.

Yes, it's a good question. In terms of future capability to grow volumes there, there are opportunities that we do continue to pursue Dean touched on some of the incremental work that we've done over the past few years that really grab kind of small snippets of capacity. And there are opportunities to go bigger than that and do through the bottlenecking work. And our team does continue to evaluate those opportunities. But you're correct that we'd be looking to plan that kind of work around turnaround execution windows given the nature of the work and the importance of run time in that facility in between turnarounds.

Okay. Awesome. Last one for me. Just what impact has the cold snap recently had on operations? And how do you view asset performance in inclement weather?

Yes. It was obviously very cold in Alberta for the first couple of weeks of January. And those extreme cold conditions do cause production issues, but maybe I'll turn it over to Jarrod to speak to that.

Yes. Well, it's a great question. And it's certainly super challenging times across the whole industry, I think, when those happen. And I really give credit and thanks to all the -- all our field folks at times like that when they're doing the best they can primarily to stay safe during conditions like that and then also keep the facilities running safely and reliably. So we made up pretty well. But we -- as you'd expect, in minus 40 conditions, there are some things that just don't run that well. So there's always minor things that happen at our sites and with our producer customers out in the field as well. So those folks are always working together to try to keep things running as best they can. But I think you can always expect some sort of impact when it gets that cold.

There are no further questions at this time. I'd now like to turn the call back over to Mr. Locke for final closing comments.

Yes. Thank you all again for joining us today, and please feel free to reach out to our Investor Relations team with any additional questions you may have. Thank you.

Thank you, sir. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a lovely day.