Release Date: February 28, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you discuss the commercial and growth opportunities from the Yellowhead Mainline project, particularly regarding additional frac capacity or export capacity? A: Jaret Sprott, COO, explained that Pembina was awarded exclusive extraction rights on the Yellowhead Mainline, which is expected to be operational in the latter half of 2027. They estimate building around 500 million cubic feet per day of extraction capacity, resulting in approximately 25,000 barrels of NGL extraction. Pembina is evaluating how this fits into their supply portfolio, particularly in supporting Dow's net-zero cracker. The extracted C3+ could be integrated into existing frac capacity and marketed domestically or internationally.
Q: Regarding the Greenlight project, what is the potential size of the gas requirement, and how might this translate to additional capacity on Alliance? A: Stuart Taylor, SVP of Marketing, New Ventures, and Corporate Development, stated that each phase of the Greenlight project will consume approximately 80 million cubic feet per day of gas. There is significant demand for expansion opportunities from the shipper group on the Alliance pipeline, and Pembina is evaluating both short-haul and long-haul expansion options.
Q: Can you provide details on the capital requirements for the Yellowhead Mainline's straddle facility and its contribution to the ethane supply agreement? A: Jaret Sprott, COO, estimated the cost of the straddle facility to be between $400 million and $500 million. Approximately 50% of the 25,000 barrels per day extracted would be ethane, which could supplement the 50,000 barrel per day supply agreement with Dow. Pembina is evaluating how these barrels fit into their existing supply portfolio and future expansions.
Q: How does the Greenlight project's return profile compare to traditional midstream investments, and will the economics be secured by long-term contracts? A: Cameron Goldade, CFO, indicated that the base returns for the Greenlight project are expected to be consistent with midstream infrastructure returns. The project is intended to be underpinned by long-term contracts, minimizing merchant exposure.
Q: With the geopolitical developments in Europe and policy movements in the U.S., how is Pembina progressing in contracting capacity for Cedar LNG? A: Stuart Taylor, SVP of Marketing, New Ventures, and Corporate Development, reported strong interest from a broad range of customers, including Canadian producers and international oil companies. Pembina has received term sheets exceeding the available capacity and is moving towards detailed negotiations.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.