Alan Armstrong; President
Chief Executive Officer at Williams Companies
Great. Well, thanks Danilo and thank you all for joining us today. We have a very positive story to share with you today on our fourth quarter performance, but even more so on how 24 has really driven positive momentum for growth in 25 and beyond. So beginning here on Slide 2 with a look back at some highlights from 2024, I'll start by noting that. At this winter, Transco has experienced unprecedented demand for both natural gas and importantly for peak capacity on our system. In fact, last month we set an all time record moving 522 million decotherms were about 10% more than the previous monthly record that occurred during January of 2022. And despite the milder weather for this time around, we had back to back to back all time peak days with each one surpassing the previous due to consistent widespread demand across the Northeast Carolinas and the Southeast. And in fact 17 of the 20th highest volume days that we've ever recorded on Transco happened just this winter. And it wasn't just due to cold weather. It was from a combination of heating, power generation loads and LNG exports along the Transco corridor. So we are really rewriting the history book on peak days. And we remain convinced that our strategy of staying intensely focused on natural gas infrastructure is in the very early innings of paying off for our shareholders. But a good strategy also has to be married up with crisp execution. And our team continues to deliver in a big way on executing large scale expansion projects in a very reliable manner for our customers. And these aren't the run of the mill projects. They include expanding in some of the toughest areas like 8800 foot of water depth on our well project that came in well under the original budget or even more hostile places like New Jersey for our regional Energy access project. And then in December we brought on the south side Reliability Enhancement Project in Virginia. And for the sake of our customers and the consumers in these areas, it's a good thing that we did. As both REA and the south side Reliability Enhancement Project are running at full contracted capacity despite the opposition claiming they weren't necessary. The irony is that even though the opposition has been motivated by greenhouse gas emission concerns, these expansions have been key in reducing emissions in the areas by avoiding fuel switching to oil and coal. Not only do we have clear line of sight for the full roster of projects and execution, but we continue to commercialize vital high return projects across our footprint. To that point, we announced six new transmission projects and continue a steady beat of actualizing these new projects. We also further optimize our asset portfolio by consolidating our interest in the Gulf and the Deep Water Discovery system and the Wamsutter Upstream joint venture. And we also divested our interest in Auxabel last year. Moving across the slide, I'll call out our emission reduction project. We've long stated that our natural gas focus. Strategy remains synonymous with sustainability, and last year we continued efforts to drive out emissions from our system by replacing 92 compressor units, most of which were over 50 years old. And these older units were certainly not designed to limit NOx or methane emissions. So a tremendous job by our team of getting this important work done in time to be included in the latest Transco Rate case. And again, very crisp execution on some very complex projects across the system. Looking at earnings growth, we reported another year of record adjusted EBITDA, which marks the 12th consecutive year that we've grown our earnings. Important to note that 2024's earnings record was achieved in a backdrop of natural gas prices that averaged about $2.20 per MMBtu and and this was nearly as low as the average price of nearly $2 that we saw during the pandemic in 2020. Just to put that in context. So this really does continue to underscore the resiliency of our business through a number of price cycles. So I'm very pleased with our 2024 performance and the long track record of growth, but the fundamentals ahead of us present an even more fruitful environment on a per share growth basis in 25 and beyond, which I'll dive into here in the next slide. Our keen focus here on slide three, our keen focus on industry leading returns remains a key driver of earnings growth in 25 and beyond, and I'll highlight a few notable drivers here. First, we are placing into service eight interstate transmission projects totaling 1.25 BCF per day over the course of the year. In addition, we will also benefit from a full year's earnings contribution from recently completed projects such as Regional Energy Access, the South side Reliability Enhancement, the Carolina Market Link and the Uintah Basin expansion on the Mountain West Transmission system. Also of note, our guidance includes conservative earnings expectations from the Transco Rate case, especially considering the large amount of capital we have invested over the last few years in things like our emission reduction project and other large maintenance projects on the Transco system in the deep water. We will have four projects commence service during 2025, including the Whale expansion, which Shell began producing into here in January. And these additions will lead to a significant earnings increase from our Gulf of America assets in 25 and 26. In our gathering and processing business, we will place two large Haynesville projects in service this year, including the Louisiana Energy Gateway project that will come on in the second half of the year and also. Drive earnings in 25 and 26 and we should see a stronger environment for gathering volumes with the current 12 month strip averaging around $4 per MBtu versus the $2.20 that drove price related shut ins last year. To be clear, our guidance does not anticipate a big ramp up in drilling activity, just a lower level of price related curtailment that we saw last year. And as I mentioned earlier we continue to invest in our business through strategic bolt on acquisitions. In the wamsutter we purchased the remaining 25% interest in our upstream JV. By controlling these upstream operations and development it will ensure that Williams can maximize the long term value of the total asset by better leveraging our existing midstream and downstream assets and in doing so capture significant margin on each molecule through gathering, processing, ngl, transportation and fractionation. So lots of incremental value for us coming off this asset as we focus on developing this large blade and really driving the free cash flow through our midstream systems. In the DJ basin we acquired rimrock, adding another gas gathering and processing system to integrate into our footprint and add value to the downstream NGL assets. Given the strong fundamentals around our strategic asset footprint, we remain positioned to continue growing our business beyond 25 I'm pleased to announce two additional projects on the Northwest Pipeline system in addition to the three that we announced last quarter. These are a clear indication of the incremental needs for natural gas consumption in the Northwest that it seems to be gaining momentum within our Gulf coast storage facilities. I'm pleased to announce that we are advancing a 10bcf capacity expansion that will support industrial power generation and LNG demand for natural gas in these as these sectors ramp up and the usage of clean, affordable natural gas supplies. So really excited to see the support out there for expanding our storage facilities that we acquired just last year. We continue to close on agreements that support our backlog of 30 interstate transmission projects and we are moving attractive projects such as the Dalton Lateral expansion on Transcope and the five recently announced projects on Northwest Pipeline from our backlog into execution and have continued to successfully refill the sales Funnel supporting growth beyond 25. Important to note, this interstate transmission backlog does not include direct investment in data center projects that are currently in development. These projects are moving at a very fast pace and the most mature of these has gone far enough. Fully support us ordering all of the major equipment and long lead items for this first project and we will be announcing more details on this project in the near future once we have a fully binding agreement with this large creditworthy customer. This deal will contain terms similar to the high value transmission projects that we have been executing along our system. So really excited about that project and would tell you that a lot of things to handle on the PR and government relations side before we get out in front of ourselves with an announcement on that, but we're really excited about the way that project has moved on very quickly for us. So Here on slide 4, our natural gas focused strategy has differentiated us from our peers and it continues to drive profitable growth year after year. Not only have we delivered record EBITDA in 24, but we have done so with the same share count and without stretching the balance sheet as evidenced by our EPS growing at an impressive 14% compound annual growth rate over the past five years. This growth has been driven by our sharp project execution where in the past four years we have placed 17 large scale projects in service with an additional 14 projects in execution today. What stands out the most here, again distinct from many of our peers, is the quality of the returns that we are seeing from these projects. Equally impressive is the commercial activity behind our attractive asset footprint which continues to give us confidence in delivering on at least Our long term 5 to 7% earnings growth objective without issuing equity or stretching our balance sheet to go further. The strong natural gas fundamentals have us positioned to potentially exceed our long term earnings growth objectives over the next five years as we gain clear line of sight to the impacts of LNG exports, coal to gas switching particularly out west as we're seeing that rapidly change and industrial reshoring and using our skill sets to help support solve demand for a whole new customer segment that is looking for highly reliable, fast to market and fast following power generation. So we are really excited at how attractive the current macro environment is in supporting the long term growth of our business. And with that I'll turn it over to John to walk through our financial metrics. John
