Pat McDonie: Well, I think we showed the level of confidence in what we think our volume is going to be. We’ve got two plants under construction, in the process of clearing a third plant site. And we’re not building because, we don’t think the volume growth is there certainly through the producer discussions that we have and what we’re seeing getting done and as Matt alluded to, we’re behind getting compression in place, et cetera. Some of the producers lag a few weeks, there’s equipment delays, et cetera. So I would look at the third quarter’s anomaly. Certainly, when you walk into a winter you don’t know what weather expectations and what impact that has on production. But I think the key answer there is the underlying business is solid. The activity levels are high and we have a lot of confidence as indicated by what we’re investing in the Delaware for future volume growth.
KeithStanley: That’s helpful. Second I just want to clarify the capital return framework. So 40% to 50% of operating cash flow to equity holders, which could be buybacks and dividends. It sounds like the frameworks effectively allows the company to meet its growth objectives and still keep you in that leverage target of three to four times overall. I’m asking just because it seems — it just feels like a pretty big step change. You have this 50% dividend hike and 40% to 50% would also imply a pretty big step-up in buybacks as well. So just want to make sure I’m understanding that right.
Jen Kneale : Keith, this is Jen. I think what we’re trying to do is just provide some visibility into some of the target specific metrics that we look at. If you look at our LTM return of capital as a percent of cash flow from operations here over the last 12 months, you’ll see that we’re lower than peers lower than the S&P 500 lower than the S&P Energy average. And so part of this is indicating we’ve had really strong total return performance and believe that we will have strong total return performance going forward, which is really based on the value proposition that we think we provide, significant EBITDA growth continued ability to return and high return organic growth capital projects. And because of that and having a strong balance sheet the ability to also return more capital to shareholders.
So one of the big questions we get is, well, how much more and what does that look like and how are you thinking about it? And that’s why we’re really trying to articulate that this isn’t a bright line and this isn’t a we must. It’s really just instructive as we look out over our multiyear forecast across a number of different scenarios. That’s one of the important elements or quantitative metrics that we are looking at. And I think as we think about a multiyear framework so 2024, 2025, 2026, 2027, 2028 five-year planning horizon we look across those multiple years and believe that it’s reasonable to say that we will have the business that could support returning that much capital to shareholders and ultimately we’ve made one decision that we’ve announced today which says this is our expectation that we’ll recommend dividend to our Board for approval effective the first quarter of 2024, and then we’ll continue to evaluate.
But it is one of the important metrics that I think we are looking at to inform how we believe we can return capital over multiple years.
Keith Stanley: Got it. Thank you.
Jen Kneale : Thank you.
Matt Meloy : Thank you.
Operator: Thank you so much. One moment for our next question please. Our next question comes from the line of Tristan Richardson with Scotiabank. Your line is now open.
Tristan Richardson : Hey, good morning guys. I may have missed it in the prepared remarks, but can you talk about any updates you’re seeing broadly in the market on the gas solutions side maybe how that market has evolved since you first planted a flag with your potential solution? And then maybe any updates on commercial development of your specific project?
Bobby Muraro : Hi. This is Bobby. So what I’d tell you is the message around APEX and the effort on APEX and residue solutions for the Permian Basin does not change for Targa. Our priority is to make sure that solutions for the Basin get built. We’ve talked about a solution needed in the 2026-ish time frame, which is why we have been pushing at APEX. And I’d say, why we’ve been pushing APEX. It’s really been a group of investment-grade counterparties shippers and markets that has driven the design of that. But what I’d tell you is that some of the changes, which are positive is there, I think are multiple options that have started to come to fruition maybe be too strong of a word, but opportunities for other solutions. And at the end of the day, Targa has one priority and that’s to make sure that the gas gets out of the basin.
So whether it ends up being APEX or another pipe and whether we — they need our help to back another pipe or not that’s where we’ll be is to make sure that pipe gets built or APEX get built or something gets built for the 2026 time frame. Again, if APEX goes it will be, because it’s in a framework that works for us and works for the counterparties that are out there. But if APEX doesn’t go we stand ready to make sure another solution goes in 2026 and that the Basin has that takeaway such that gas can continue to flow in our plants and NGLs down our integrated system.
Tristan Richardson: Appreciate that context, Bobby. And then I know we’ve just now gotten the export expansion online. But as we think about Daytona and third-party volumes coming into the frac, do you see the export market starting to tighten up? And then does your capacity today really allow for headroom assuming a reasonable utilization of Daytona once we’ve been ramping on that asset late in 2024 and into 2025.
Scott Pryor: Hi, Tristan. This is Scott. Yes, I would say that today the market feels tight. We were very pleased with the timing of our most recent export expansion coming online because we are seeing benefits. And again as I stated earlier we will continue to look for ways to optimize around that capacity and better ways to facilitate movements across the dog. So we’re very pleased with that being online. With that said, as we look to as we look at further expansions at our facility, we continuously explore opportunities in the form of small projects or debottlenecking projects at our Galena Park facility that will provide meaningful capacity improvements while being capital efficient. We are very fortunate to have an existing facility today that we have a lot of runway to add projects to that are very capital efficient that will provide us capabilities moving forward.
So we’ll continue to watch the volume growth in and through our system and we’ll time those various projects accordingly. But again we’re very fortunate to already have an existing facility that we can kind of bolt on to very effectively.
Tristan Richardson: Appreciate it, Scott. Thank you, guys and congrats on the capital allocation plan.
