Some key tidbits from the earnings call transcript.....
Tarek Hamid
And then I guess, on Grand Mesa you talked about sort of a handful of potential opportunities to increase volumes over the next few months. I guess we'd just love to get kind of your sense on sort of the magnitude of that, sort of how do you think about kind of the exit volumes on Grand Mesa year-end versus kind of year-end '25 versus year-end '24?
Brad Cooper
Yes, I think with what Don and his team are working on right now, line of sight, we probably assume 70,000 barrel a day range today, call it 50% uptick from there. I think north of 100 with the potential to get to 110, 115 per day over the next six to 12 months.
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That's phenomenal if true. They think Grand Mesa may increase volumes by 50% in 9 months? It's hard to believe, but amazing if true.
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Tarek Hamid
And then just last one for me. You talked about looking at potential strategic alternatives for the Liquids business. Just love to get any kind of additional flavor you have there? Are you thinking kind of acquisitions, divestitures, joint ventures, sort of where is your head at on that?
Brad Cooper
Yes, I think it's more on the divestiture side. We've got a suite of assets in that Liquids business, hard assets that could fetch a nice multiple for the right buyer. We don't need to do anything. I think it's just a continued rationalization of each business unit and each segment and what assets we have at our disposal.
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That sounds nice. This business produced EBITDA of $70m in a disappointing year just completed. If they can sell it for $700m cash, that could put the "what to do about the preferreds?" question to rest. Lets hope they sell it at a nice multiple to EBITDA.
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Gregg Brody
...going back to water. Could you talk about the underlying volume growth you're assuming excluding LEX II? And then how does LEX II layer in and how should we think about how volumes are going to ramp there?
Brad Cooper
Well, if LEX -- let's say LEX II is 200, if we're at 2.6-ish, I mean 10%, 260. So that's kind of LEX II plus what we -- the other contract we talked about that goes from [350 to 450] (ph). So it's really -- I mean, the good news is that, it's really what we've already got in our back pocket. So if there are additional deals, contracts, volumes, that'll -- it would be a higher rate of increase than the 9%, 10%.
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Can anyone understand the question or the answer? I can't. |
