Jamie Welch: I think as far as let’s go in reverse order. On the egress side, we have customers every day. Both existing and new customers approaching us about new packages of gas customers, we’re always open for them to tell us that they would like to, in fact, have Gulf Coast pricing. When you do a weighted average sales price calculation for residue gas, we give people an option. They can have Waha. They can have a mix of Waha and Gulf Coast. And so we have more and more customers telling us, hey, we want more Gulf Coast, right? And I would say the relationships we have and the way you build the relationships is you continue to embed that concept of partnership. And that concept of partnership I think a news to your benefit as you think about future development and opportunities that you get.
So we do have people. We’ve got space that we can manage, not just because we’re the majority owner of PHP and how it’s performing but also just given the space that we’ve contractually taken. And we’ve got – this is a constant dialogue with some many of these folks. And then Trevor, do you want to just take that first question on the treating side?
Trevor Howard: Yes. Thanks for the question Spiro. I’d say, we are seeing some benefits on the volume side but really where we see it is margin expansion, which is fantastic, right? Because that’s 100% incremental to the bottom line without taking up what is really a precious asset in the basin right now which is any remaining spare processing capacity. So we’re seeing the benefits right now that with system-wide front-end aiming treating fully complete. We have an immediate step-up in margin. And then the commercial team is working right now to continue to sell out the remaining space both for sweet and sour gas treating and processing.
Jamie Welch: And we are seeing, as we mentioned in the February call, we’ve got some customers that actually have really elevated levels of CO2. And we’re obviously, now fully accommodating that. And obviously, we have a stair step or a tiering structure pretty much across the board in the context of how we get treating fees. We’ve got H2S. We have CO2. We even have – we are seeing some nitrogen coming out, right? And what’s interesting about our business is because of the size of the system and the sources from where we’re pulling the gas, we have a lot of sweet gas, which is – has virtually no impurities in it and we have gas which has higher levels of impurities. And obviously, the blend of the two makes pipelines backed gas that it meets all tariffs. And it’s obviously, massively beneficial to the customers and the producers. And we get paid for it as Trevor pointed out. So it’s a win-win we think across the board.
Spiro Dounis: Got it. That’s great. I will leave it there and look forward to seeing you all next week.
Jamie Welch: We’ll see you Tuesday.
Operator: Thank you. The next question comes from the line of Tristan Richardson with Scotiabank. Your line is now open.
Tristan Richardson: Hi good morning, guys. Jamie, maybe could you talk a little bit about the NGL side of downstream. I mean we’re closing in on a couple of third-party pipe expansions. Can you talk about how you see your NGL solutions trending once we see these expansions online? And then particularly in the context of thinking about Kinetik barrels that may come up for recontracting.
Jamie Welch: Tristan, good morning. Thank you for the question. So as far – I think we’ve been pretty clear as far as on the NGL side. We have three different commitments. We have commitment to Lone Star, with respect to some of the legacy plants. We inherited one with Cap Rock. There was obviously some in relation to what is Eagle Core Midstream Ventures, which is primarily is East Toyota and one of the Pecos Bends. And then we have the Enterprise – the Enterprise commitment that we have inherited in large part because Enterprise was the only connection to Diamond Cryo. And as you all know Apache was one of the foundation shippers on the Shin Oak pipeline. So we have contracts with Lone Star come up in 2026. There are two of them and they will roll off.
And then we obviously have our dedication with – or commitment with Targa on Grand Prix and that will continue out through beginning of early 2030s. And then we obviously have what we have at Diamond Cryo. Where we – if you go back to first principles and think about the merger, where you saw the open space in the entire the system complex from a processing standpoint was Diamond. Our job is to be to fill up Diamond Cryo. It is the best recoveries. We expanded it from 600 to 720, there the only other tenant that sits at Diamond Cryo is Apache. And so we’ve been utilizing that space. And therefore, we have a very I would say a mutually beneficial, very flexible arrangement with EPD on Shin Oak that really gives us flexibility. It’s very beneficial economically.
And we obviously own, one-third of Shin Oak as well. So, we think literally all the stars are aligned to make a good outcome. As it relates to future barrels, we’ll decide that as it relates certainly to further expansions we’ve got flexibility with respect to Caprock flexibility as — when that contract obviously rolls off. So we’ve got plenty of flexibility that we can think about sort of what to do next. It’s something that Anne Psencik and the team spent a lot of time focused on, as we think about the future. We see all these announcements. We’re trying to work out whether in fact obviously, the basin has been pretty tight right now. In fact, they’ve been jamming like — I’m looking at any every barrel they can, because when you’re at negative $3, it’s not a good day and you want to get as much recovery of ethane in the stream, as you possibly can.
And we’re still trying to work out, whether in fact what the fundamentals will look like we’re going to see a lot of pricing pressure going forward, so more power to the customer than necessarily to the owner of the infrastructure. Time will tell, how this is all going to play out. We’re not the only ones with obviously, these mid 2025 2026 time frames. There’s what 1.5 million barrels, a day of incremental expansions that are coming on. So it’s not insignificant right by her and Daytona and other things. So, I do think that look, it’s going to be a really interesting segment to watch. As I said, we’re not the only ones. There’s lots of other dedications that will roll off. As you see, I would say, sort of the NGL 1.0 contracts roll off in the 2025 2026 ’27 time frame and see exactly, what happens.
