Equitrans Midstream Corp (ETRN) 2022 Q3 法說會逐字稿

Good morning. My name is Rob, and I will be your conference operator today. At this time, I'd like to welcome everyone to the Equitrans Midstream Corporation Third Quarter 2022 Results Conference Call. (Operator Instructions) Nate Tetlow, Vice President, Corporate Development and Investor Relations, you may begin your conference.

早上好。我的名字是 Rob，今天我將成為您的會議接線員。在這個時候，我想歡迎大家參加 Equitrans Midstream Corporation 2022 年第三季度業績電話會議。 （操作員說明）企業發展和投資者關係副總裁 Nate Tetlow，您可以開始您的會議了。

Good morning. and welcome to the third quarter 2022 Earnings Call for Equitrans Midstream Corporation. A replay of this call will be available for 14 days beginning this evening. The phone number for the replay is (800)770-2030 or (647)362-9199 and the conference ID is 6625542.

早上好。歡迎來到 Equitrans Midstream Corporation 的 2022 年第三季度財報電話會議。從今晚開始，該電話的重播將持續 14 天。重播電話為（800）770-2030或（647）362-9199，會議ID為6625542。

Today's call may contain forward-looking statements related to future events and expectations. Please refer to today's news release and Risk Factors in ETRN's Form 10-K for the year ended December 31, 2021, and as updated by Form 10-Qs. for factors that could cause the actual results to differ materially from these forward-looking statements.

今天的電話會議可能包含與未來事件和預期相關的前瞻性陳述。請參閱今天的新聞稿和 ETRN 表格 10-K 中截至 2021 年 12 月 31 日的年度的風險因素，並由表格 10-Qs 更新。可能導致實際結果與這些前瞻性陳述產生重大差異的因素。

Today's call may contain certain non-GAAP financial measures. Please refer to this morning's news release and our investor presentation for important disclosures regarding such measures, including reconciliations to the most comparable GAAP financial measure.

今天的電話會議可能包含某些非公認會計原則的財務措施。請參閱今天上午的新聞稿和我們的投資者介紹，了解有關此類措施的重要披露，包括與最具可比性的 GAAP 財務措施的對賬。

On the call today, are Tom Karam, Chairman and CEO; Diana Charletta, President and Chief Operating Officer; Kirk Oliver, Senior Vice President and Chief Financial Officer; Justin Macken, Senior Vice President, Gas Systems Planning and Engineering; Brian Pietrandrea, Vice President and Chief Accounting Officer; and Janice Brenner, Vice President and Treasurer. After the prepared remarks, we will open the call to questions.

今天的電話會議是主席兼首席執行官湯姆·卡拉姆（Tom Karam）； Diana Charletta，總裁兼首席運營官； Kirk Oliver，高級副總裁兼首席財務官； Justin Macken，氣體系統規劃和工程高級副總裁； Brian Pietrandrea，副總裁兼首席會計官；以及副總裁兼財務主管 Janice Brenner。在準備好的評論之後，我們將打開提問電話。

With that, I'll turn it over to Tom.

有了這個，我會把它交給湯姆。

Thanks, Nate, and good morning, everyone. Today, we reported third quarter results including a net loss of $504 million, adjusted EBITDA of $259 million and deferred revenue of $85 million. We also increased our full year free cash flow guidance. Kirk will provide details on the financial results in a few minutes.

謝謝，內特，大家早上好。今天，我們公佈了第三季度業績，包括 5.04 億美元的淨虧損、2.59 億美元的調整後 EBITDA 和 8500 萬美元的遞延收入。我們還增加了全年自由現金流指導。柯克將在幾分鐘內提供有關財務結果的詳細信息。

Let me start with MVP. Today, we announced an impairment of $583 million, primarily on the basis of the increased timing uncertainty now present in the normal permitting path through the Fourth circuit quarter. Kirk will discuss some of the factors in that analysis in a minute.

讓我從MVP開始。今天，我們宣布減值 5.83 億美元，主要是基於第四巡迴賽季度的正常許可路徑中現在存在的時間不確定性增加。柯克將在一分鐘內討論該分析中的一些因素。

On that permitting path, we remain actively engaged with all of the agencies since the Fourth Circuit vacated for the second time these permits in early 2022. We are continuing to work with the agencies to produce permits that when reissued will exceed all legal standards used by federal courts as well as this courts unreasonably high bar. That said, based on the hearing conducted by the Fourth Circuit panel last week regarding a challenge to the West Virginia 401 certification, it was evident that the same court panel that has consistently overruled technical conclusions of federal and state regulators more than 10x, again appeared hostile to the West Virginia Department of Environmental Protection's issuance of a permit for MVP.

在這條許可路徑上，自第四巡迴法院於 2022 年初第二次騰出這些許可證以來，我們一直與所有機構積極合作。我們將繼續與這些機構合作，以製作重新頒發時將超過所有法律標準的許可證聯邦法院以及本法院的門檻高得不合理。話雖如此，根據第四巡迴法庭上週舉行的關於對西弗吉尼亞州 401 認證提出質疑的聽證會，很明顯，同一個法庭小組一直以超過 10 倍否決聯邦和州監管機構的技術結論，再次出現反對西弗吉尼亞州環境保護部頒發 MVP 許可證。

As in any federal permitting project, there remains some uncertainty on the federal agency front regarding timing. As I said, we are engaged with the agencies as they work to develop and refine their proposed schedules for permit issuance. Notwithstanding these uncertainties, in our view that this Fourth Circuit panel far exceeds well-established boundaries for agency deference. We will continue pursuing the permitting path available under the existing law.

與任何联邦許可項目一樣，聯邦機構在時間安排方面仍然存在一些不確定性。正如我所說，我們正在與這些機構合作，以製定和完善其擬議的許可證發放時間表。儘管存在這些不確定性，但我們認為第四巡迴法院小組遠遠超出了機構尊重的既定界限。我們將繼續探索現行法律規定的許可途徑。

However, having been under construction since early 2018 and now being roughly 94% complete with total project work, the best path to complete MVP by the second half of 2023 and get off landowners' property, flow natural gas to help lower cost to consumers, while adding to our national and energy security is for Congress to pass legislation requiring the completion of the project.

然而，自 2018 年初以來一直在建設中，目前已完成大約 94% 的總項目工作，這是在 2023 年下半年完成 MVP 並擺脫土地所有者財產的最佳途徑，流動天然氣以幫助降低消費者的成本，在增加我們的國家和能源安全的同時，國會通過要求完成該項目的立法。

Through the efforts of Senator's management and capital, Energy infrastructure permitting reform legislation has drawn significant bipartisan support, including from representatives of the Biden administration. We remain encouraged by the continued support for permitting reform and in particular, for MVP's inclusion in that legislation. We urge Congress to act on this bipartisan momentum and pass legislation in the near term.

通過參議員管理層和資本的努力，能源基礎設施允許改革立法得到了兩黨的大力支持，包括拜登政府的代表。對允許改革的持續支持，特別是 MVP 被納入該立法，我們仍然感到鼓舞。我們敦促國會在這種兩黨勢頭下採取行動，並在短期內通過立法。

And now I'll turn it to Diana for the operations update, and then Kirk will discuss the financial results. Diana?

現在我將把它交給戴安娜來進行運營更新，然後柯克將討論財務結果。戴安娜？

Thanks, Tom. Good morning, everyone. I'll start with gathering. In the third quarter, we gathered about 7.5 Bcf per day. We continue to see producers holding to maintenance levels and believe that A-Basin volumes will remain roughly flat until further takeaway capacity becomes available. For this year, we continue to expect that gathered volumes will be slightly down year-over-year based on current year development plans and pad timing.

謝謝，湯姆。大家，早安。我將從收集開始。在第三季度，我們每天收集約 7.5 Bcf。我們繼續看到生產商保持在維持水平，並相信 A-Basin 的產量將大致持平，直到有更多的外賣能力可用。對於今年，我們繼續預計根據本年度的發展計劃和墊時間，收集量將同比略有下降。

Moving on to transmission. In September, FERC issued a draft environmental impact statement for the Ohio Valley Connector expansion or OVC X project. The expansion will add about 350 million cubic feet per day of deliverability on our Ohio Valley Connector pipeline, which provides access to the Mid-Continent and Gulf Coast markets through interconnects in Clarington, Ohio. The project is still on track to be placed in service during the first half of 2024. Total capital for the project is $160 million, and we expect to earn a build multiple of 4 to 6 times.

繼續傳輸。 9 月，FERC 發布了俄亥俄河谷連接器擴建或 OVC X 項目的環境影響聲明草案。此次擴建將為我們的俄亥俄河谷連接器管道增加每天約 3.5 億立方英尺的輸送量，該管道通過俄亥俄州克拉靈頓的互連提供進入中大陸和墨西哥灣沿岸市場的通道。該項目仍有望在 2024 年上半年投入使用。該項目的總資本為 1.6 億美元，我們預計將獲得 4 至 6 倍的建造倍數。

On the Water segment, we are progressing nicely on the mixed-use system build-out. In August, we completed and started operations at the first of 2 aboveground storage facilities. The initial facility has a capacity of approximately 150,000 barrels and in September, the first full month of operations, we offloaded and redelivered about 500,000 barrels. Our producer customers are very focused on reusing water and reducing truck traffic. And ETRN storage services play a critical role in alleviating the logistics challenge around handling daily water production and frac job timing.

在水領域，我們在混合用途系統建設方面進展順利。 8 月，我們在 2 個地上存儲設施中的第一個完成並開始運營。最初的設施容量約為 150,000 桶，在 9 月，即運營的第一個完整月份，我們卸載並重新交付了約 500,000 桶。我們的生產商客戶非常關注水的再利用和減少卡車交通。 ETRN 存儲服務在緩解處理日常水生產和壓裂作業時間方面的物流挑戰方面發揮著關鍵作用。

The second storage facility, which will have approximately 200,000 barrels of capacity is targeted to be in operations in the first quarter next year. For the year, we continue to expect water EBITDA of approximately $30 million. Lastly, on ESG, we continue to make progress on methane mitigation through pneumatic conversions, either high bleed to low bleed or to full air pneumatics. This year, we've completed 7 conversions at compressor sites and have 3 more conversions planned in the fourth quarter. By year-end, we will have reduced Scope 1 methane emissions by more than 20% in starting the mitigation program. Additionally, in terms of reporting and disclosure, we recently responded to the CDP questionnaire on water security and completed the TCFD readiness assessment.

第二個存儲設施將擁有約 200,000 桶的容量，目標是在明年第一季度投入運營。今年，我們繼續預計水的 EBITDA 約為 3000 萬美元。最後，在 ESG 方面，我們繼續通過氣動轉換在甲烷減排方面取得進展，無論是從高排氣到低排氣還是到全氣動轉換。今年，我們在壓縮機站點完成了 7 次轉換，併計劃在第四季度再進行 3 次轉換。到年底，我們將在啟動緩解計劃時將範圍 1 的甲烷排放量減少 20% 以上。此外，在報告和披露方面，我們最近回復了 CDP 關於水安全的問卷，並完成了 TCFD 準備情況評估。

I'll now turn the call over to Kirk.

我現在把電話轉給柯克。

Thanks, Diana, and good morning, everyone. Today, we reported third quarter net loss attributable to E-Train common shareholders of $521 million and a loss for diluted E-Train common share of $1.20. Net loss for the quarter was $504 million. Adjusted EBITDA was $259 million and deferred revenue was $85 million. We also reported net cash provided by operating activities of $210 million and free cash flow of $37 million.

謝謝，戴安娜，大家早上好。今天，我們報告第三季度歸屬於 E-Train 普通股股東的淨虧損為 5.21 億美元，稀釋後的 E-Train 普通股虧損 1.20 美元。本季度的淨虧損為 5.04 億美元。調整後的 EBITDA 為 2.59 億美元，遞延收入為 8500 萬美元。我們還報告了經營活動提供的淨現金為 2.1 億美元，自由現金流為 3700 萬美元。

Net income attributable to E-Train common shareholders was impacted by several items. First, the $583 million impairment to our investment in the MVP joint venture, Second, by $117 million increase to income tax expense primarily due to a valuation allowance placed on our deferred tax assets resulting from cumulative losses that were driven by the impairment to our investment in the Mountain Valley Pipeline joint venture.

歸屬於 E-Train 普通股股東的淨利潤受到多個項目的影響。首先，我們對 MVP 合資企業的投資減值了 5.83 億美元，其次，所得稅費用增加了 1.17 億美元，這主要是由於我們的投資減值導致的累積損失導致我們的遞延所得稅資產的估值減免在山谷管道合資企業。

Third, by a $2 million unrealized loss on derivative instruments, which is reported in other income. This is related to the contractual provisions huddling E-Train to receive cash payments from EQT, additioned on specific NYMEX Henry Hub natural gas prices exceeding certain thresholds post-MVP's in-service and through 2024.

第三，衍生工具的 200 萬美元未實現損失，在其他收入中報告。這與將 E-Train 合併以從 EQT 接收現金付款的合同條款有關，加上特定的 NYMEX Henry Hub 天然氣價格在 MVP 投入使用後和到 2024 年超過某些閾值。

And lastly, by a $3.7 million gain on sale of non-core gathering assets. This is a onetime item and relates to the sale of Equitrans gathering assets that serve low-pressure vertical wells. After adjusting for these items, third quarter adjusted net income attributable to E-Train common shareholders was $38 million and adjusted earnings per diluted share was $0.09. With regard to the impairment of the MVP investment and determining the value of the investment, we consider a lot of factors, including the remaining regulatory process and core actions. And we also have variable inputs like in-service timing probabilities and cost of capital considerations. The impairment resulted primarily from a decrease in the in-service timing probabilities, which is a direct result of timing uncertainty around permit issuance and the continued challenges at the Fourth Circuit.

最後，通過出售非核心採集資產獲得 370 萬美元的收益。這是一項一次性項目，與出售服務於低壓垂直井的 Equitrans 收集資產有關。在對這些項目進行調整後，第三季度調整後歸屬於 E-Train 普通股股東的淨利潤為 3800 萬美元，調整後每股攤薄收益為 0.09 美元。關於MVP投資的減值和確定投資價值，我們考慮了很多因素，包括剩餘的監管流程和核心行動。我們也有可變的投入，如在役時間概率和資本成本考慮。減值主要是由於在役時間概率的下降，這是許可證發放時間不確定性和第四巡迴賽持續挑戰的直接結果。

E-Train operating revenue for the third quarter of 2022 was lower compared to the same quarter last year by $10 million. This is primarily from higher deferred revenue and lower gathered volumes and was partially offset by increased water service revenue. Operating expenses for the third quarter 2022 were nearly flat with the same quarter last year. For the third quarter, E-Train will pay a quarterly cash dividend of $0.15 per common share on November 14 to common shareholders of record at the close of business on November 2. In early July, EQT elected to receive $196 million cash payment and to forego up to $235 million of future rate relief.

與去年同期相比，E-Train 2022 年第三季度的營業收入減少了 1000 萬美元。這主要來自較高的遞延收入和較低的收集量，部分被供水服務收入的增加所抵消。 2022 年第三季度的運營費用與去年同期幾乎持平。對於第三季度，E-Train 將於 11 月 14 日向 11 月 2 日收盤時登記在冊的普通股股東支付每股普通股 0.15 美元的季度現金股息。7 月初，殷拓選擇接受 1.96 億美元的現金支付，並將放棄高達 2.35 億美元的未來利率減免。

The cash payment, which was made on October 4, represents final consideration for approximately 20.5 million E-Train common shares that were purchased from EQT and retired in the first quarter of 2020. Today, we updated our full year guidance to reflect a modest decrease in expected CapEx and an associated increase in free cash flow and retained free cash flow. For the year, we now expect CapEx and capital contributions of $540 million to $580 million and free cash flow of $355 million to $375 million.

現金支付於 10 月 4 日支付，代表從 EQT 購買並於 2020 年第一季度退休的約 2050 萬股 E-Train 普通股的最終對價。今天，我們更新了全年指引以反映適度下降預期資本支出以及自由現金流和留存自由現金流的相關增加。今年，我們現在預計資本支出和資本投入為 5.4 億美元至 5.8 億美元，自由現金流為 3.55 億美元至 3.75 億美元。

I'll now hand the call back to Tom.

我現在將電話轉回給湯姆。

Thanks, Kirk. So in summary, the base business and operations continue to perform well. We're executing on our organic gathering and transmission projects and establishing a premier water handling network. And on MVP, we are committed to completing the project. We will continue to pursue durable permits from federal agencies and at the same time, work to promote legislation to complete MVP and reform federal permitting process.

謝謝，柯克。綜上所述，基礎業務和運營繼續表現良好。我們正在執行我們的有機收集和傳輸項目，並建立一個一流的水處理網絡。在 MVP 上，我們致力於完成項目。我們將繼續尋求聯邦機構的持久許可，同時努力推動立法以完成 MVP 和改革聯邦許可程序。

With that, we're happy to take your questions.

有了這個，我們很高興回答您的問題。

(Operator Instructions) And your first question comes from the line of John Mackay from Goldman Sachs.

（操作員說明）您的第一個問題來自高盛的 John Mackay。

Let's start on MVP. I guess, could you share a little bit more? I understand the moving parts of the impairment, but when you're talking about risks to timing, I mean what can timing look like at this point? Are you comfortable if the process plays that in a different way and we start talking about a 2024 in service, 2025? I'm just trying to think of a book end and kind of what went into the $580 million to kind of get you there?

讓我們從MVP開始。我想，你能再分享一點嗎？我了解損害的變化部分，但是當您談論時機的風險時，我的意思是此時時機會是什麼樣子？如果流程以不同的方式播放，您是否感到舒服，我們開始談論 2024 年服役，2025 年？我只是在想一本書的結尾，以及 5.8 億美元中的什麼讓你到達那裡？

Yes. John, thanks. This is Tom. Thanks for the question. Look, we remain confident that we're going to complete MVP through 1 path or another. And along with our MVP partners, we're fully committed to doing so. It's difficult to provide a definitive time line until we know which path we will travel, right? But regardless of which path, if we can mobilize construction crews in the summer of 2023, we can still bring MVP into service in winter of 2023. So that's the message we're trying to deliver as opposed to hanging on any specific date or specific schedule order, right?

是的。約翰，謝謝。這是湯姆。謝謝你的問題。看，我們仍然有信心通過一條或另一條路徑完成 MVP。與我們的 MVP 合作夥伴一起，我們完全致力於這樣做。在我們知道我們將走哪條路之前，很難提供一個明確的時間表，對吧？但無論走哪條路，如果我們能在 2023 年夏天動員施工人員，我們仍然可以在 2023 年冬天將 MVP 投入使用。所以這就是我們試圖傳達的信息，而不是掛在任何特定日期或特定日期安排順序，對吧？

So the message is we remain confident, we remain committed as do our partners and that if we can mobilize construction crews by the summer of 2023, we can bring the needed natural gas relief into winter of 2023, so that we can help lower the cost to consumers aid in our national and energy security and provide some assistance through displacement with LNG exports to our (inaudible). So that's the definitive answer to the question.

因此，我們傳達的信息是，我們仍然充滿信心，我們仍然像我們的合作夥伴一樣致力於，如果我們能夠在 2023 年夏季之前動員施工人員，我們就可以將所需的天然氣救濟帶到 2023 年冬季，這樣我們就可以幫助降低成本向消費者提供幫助以保障我們的國家和能源安全，並通過向我們出口液化天然氣（聽不清）來提供一些幫助。所以這就是這個問題的明確答案。

All right. I appreciate that. Maybe let's shift gears, talk about gathering. So I think going into the year, at the beginning of the year, you talked about that water line that was down, causing a little bit of weakness. Just curious, is the 3Q softness we saw in gathering and then some of the softness we saw from your largest producer counterparty, is that the same thing? Or is there kind of something incremental that was driving weaker volumes this quarter? And maybe if we kind of think about how we're going to fourth quarter off of that?

好的。我很感激。也許讓我們換檔，談談聚會。所以我認為進入今年年初，你談到了下降的水位線，造成了一點點疲軟。只是好奇，我們在收集中看到的 3Q 疲軟，然後我們從你們最大的生產商對手那裡看到的一些疲軟，是一樣的嗎？還是有某種增量因素導致本季度銷量下降？也許如果我們考慮一下我們將如何進入第四季度？

John, this is Justin. I can answer that one. So the water line issues that we experienced earlier this year required that we replace a few select lines to ensure the quality of that system that we are building out. We're addressing that problem now. And I think that's behind us at this point. And I think EQT touched on that on their call as well.

約翰，這是賈斯汀。我可以回答那個。因此，我們今年早些時候遇到的水線問題要求我們更換一些選定的水線，以確保我們正在建設的系統的質量。我們現在正在解決這個問題。我認為這已經落後於我們了。我認為 EQT 在他們的電話會議上也談到了這一點。

What you did see was some Cascading impacts to schedules because of that as certain fracs were reprioritized during the time period in which we were replacing certain lines. So you see that play out throughout the year as their schedule is impacted. But like I said, I think that's largely behind us at this point. And I think as Diana touched on in her prepared remarks, our guidance throughout the year has been based on flat to mid-single-digit declining volumes throughout the year and until more infrastructure is built out of the basin, we do expect that the producers will remain in that maintenance mode so that it can get built.

您確實看到了對時間表的一些級聯影響，因為在我們更換某些線路的時間段內，某些壓裂被重新確定了優先級。因此，隨著他們的日程安排受到影響，您會看到全年都在發揮作用。但就像我說的那樣，我認為這在很大程度上已經落後於我們。而且我認為正如戴安娜在她準備好的講話中所提到的那樣，我們全年的指導是基於全年持平到中個位數的下降量，直到在盆地之外建立更多的基礎設施，我們確實希望生產商將保持該維護模式，以便可以構建。

Your next question comes from the line of Neel Mitra from Bank of America.

您的下一個問題來自美國銀行的 Neel Mitra。

First wanted to touch on EQT and the recent Tug Hill acquisition, just give them a little bit more flexibility on where they drill. I was wondering if you've had discussions with them about budgeting and planning for '23 and if that would impact kind of your base plan going forward? Any color you can provide on that?

首先想談談 EQT 和最近對 Tug Hill 的收購，只是讓他們在鑽探的地方多一點靈活性。我想知道你是否與他們討論過 23 年的預算和規劃，這是否會影響你未來的基本計劃？你可以提供任何顏色嗎？

This is Justin again. So certainly, we're in conversations with EQT regularly about their plans. We have talked to them about this acquisition. As we see it, the XcL assets are really built for purpose around the upstream assets that they're acquiring, not really any material overlap with our gathering assets. That XcL system does have an interconnect into our OVC system. And so we do see some opportunities there to bring additional volumes from the newly acquired acreage for EQT onto our systems to give them some more downstream optionality for marketing.

這又是賈斯汀。因此，當然，我們會定期與 EQT 就他們的計劃進行對話。我們已經與他們討論了此次收購。正如我們所看到的，XcL 資產實際上是圍繞他們正在收購的上游資產而構建的，與我們收集的資產沒有任何實質性的重疊。該 XcL 系統確實與我們的 OVC 系統有互連。因此，我們確實看到了一些機會，可以將 EQT 新收購的土地上的額外產量引入我們的系統，從而為他們提供更多的下游營銷選擇權。

But on a broader scale, EQT and all the producers continue to signal that there'll be in maintenance mode. At this time, we don't see really much of any impact on our volumes flowing into our system. Due to this acquisition. And even beyond that, I think our system does offer the best path to downstream markets. And certainly, when MVP comes online, really the best path to get to that capacity.

但在更廣泛的範圍內，殷拓和所有生產商繼續發出信號，表示將進入維護模式。目前，我們並沒有看到流入我們系統的交易量受到太大影響。由於此次收購。甚至除此之外，我認為我們的系統確實提供了通往下游市場的最佳途徑。當然，當 MVP 上線時，這確實是獲得這種能力的最佳途徑。

So with all those things in play, at this time, I don't see any reason to believe that volumes would be moving away for us at market.

因此，在所有這些事情都在發揮作用的情況下，我認為沒有任何理由相信市場上的交易量會為我們減少。

Got it. And then the second question on MVP. You noted that the water hearing last week, some issues with the Fourth Circuit came up, which created some doubt. And then you also noted that you believe permitting is -- it's something that's needed. Could you elaborate more on kind of what is happening in that hearing about the water permit? And then when you look at potential legislation, are you looking for an MVP carve-out like the mansion legislation or just general permitting to get this through the finish line?

知道了。然後是關於 MVP 的第二個問題。你注意到上週的水聽證會，第四巡迴法院出現了一些問題，這引起了一些疑問。然後你還指出，你認為允許是——這是需要的。你能詳細說明一下關於水許可證的聽證會發生了什麼嗎？然後，當您查看潛在的立法時，您是在尋找像豪宅立法這樣的 MVP 剝離，還是只是一般允許通過終點線？

Yes. Thanks, Neel. Look, 2 things can be true at the same time. I think in a way, we're just stating the obvious that when a panel overrides Agency's expert conclusions 10x it's not a particularly friendly panel to the project. So, that's stating the obvious. The second is that with or without MVP and both Senator Mansion's proposed permitting reform and Senator Capital's permitting reform, meaning 2 bipartisan forms of permitting reform, each include MVP legislation to complete the project. So that we fully believe that there needs to be permitting reform. I mean, we're on our third round of having federal permits issued that have been overruled. And it's just an incredibly inefficient way to try to construct critical infrastructure in this country. if you can't have certainty and finality of expert permits that are issued from federal agencies. So I guess the answer to your question is that if there were permitting legislation that were brought forward, we would fully expect that MVP language would be included in whatever form that permitting legislation would take.

是的。謝謝，尼爾。看，兩件事可以同時為真。我認為在某種程度上，我們只是在說明一個明顯的問題，即當一個小組超過 10 倍代理機構的專家結論時，它不是一個對項目特別友好的小組。所以，這是顯而易見的。第二個是無論是否有 MVP，Senator Mansion 提議的許可改革和 Senator Capital 的許可改革，這意味著 2 種兩黨形式的許可改革，每一種都包括 MVP 立法來完成該項目。因此，我們完全相信需要進行許可改革。我的意思是，我們正在進行第三輪頒發的已被否決的聯邦許可證。這只是嘗試在這個國家建設關鍵基礎設施的一種非常低效的方式。如果您無法確定聯邦機構頒發的專家許可的確定性和最終性。因此，我想您的問題的答案是，如果提出了許可立法，我們完全希望 MVP 語言將以許可立法採取的任何形式包含在內。

But also true is that we're going to continue our very positive and constructive relationship with the federal agencies so that they can reissue durable, comprehensive permits that, as I said earlier, we'll pass muster to every federal court, even this court, which has not been the most friendliest of panels to us with this project. So that's why we remain confident. But also at the same time, we have to acknowledge the obvious that we need permitting reform in this country and that this panel has been particularly unfriendly to MVP. I hope that answers your question.

但同樣真實的是，我們將繼續與聯邦機構保持非常積極和建設性的關係，以便他們能夠重新頒發持久、全面的許可證，正如我之前所說，我們將通過召集到每個聯邦法院，甚至是這個法院，這對我們來說並不是這個項目中最友好的面板。所以這就是我們保持信心的原因。但同時，我們必須承認，我們需要在這個國家進行改革，而且這個小組對 MVP 特別不友好。我希望這能回答你的問題。

And your next question comes from the line of Brian Reynolds from UBS Financial.

你的下一個問題來自瑞銀金融的布賴恩雷諾茲。

Maybe just a quick follow-up to MVP and just the cash burn rate per quarter or by month. Are there any contract rate changes or inflationary pressures to where that rate change is materially heading into '23?

也許只是對 MVP 的快速跟進，以及每季度或每月的現金消耗率。是否有任何合同利率變化或通脹壓力導致該利率變化實質性地進入 23 年？

Yes. Brian, I think the run rate -- the burn rate is somewhere between $20 million and $25 million a month, largely for the maintenance of the right-of-way, which -- because this court has continued to vacate permits has been remained not restored for 4 years. So of course, when the right-of-way is not permanently restored, you have maintenance. Because we're 94% complete, there's really not significant or meaningful inflationary pressures or contractual pressures. It's really maintenance of the right of way because we remain on landowners' property for far too long.

是的。布賴恩，我認為運行率 - 燃燒率在每月 2000 萬美元到 2500 萬美元之間，主要是為了維護通行權，因為這個法院繼續騰出許可證，所以一直沒有4年恢復。因此，當然，當通行權沒有永久恢復時，您需要進行維護。因為我們已經完成了 94%，所以實際上沒有顯著或有意義的通脹壓力或合同壓力。這實際上是對路權的維護，因為我們在土地所有者的財產上停留的時間太長了。

And maybe just to touch a little bit on capital allocation and just rising rates and for an interest rate exposure. I know you have some excess free cash flow in '22, that should flow through into '23. But kind of just curious with the aforementioned question on burn rate. And then in addition, just to sum a little bit of debt on your revolver and you have the press. Are there any interest rate exposures that we should be thinking about the '23 that could impact that free cash flow profile?

或許只是觸及一點資本配置、利率上升和利率風險敞口。我知道你在 22 年有一些多餘的自由現金流，應該會流入 23 年。但是有點好奇上述關於燃燒率的問題。此外，只是為了給你的左輪手槍加上一點債務，你就有了媒體。是否有任何我們應該考慮的可能影響自由現金流狀況的 23 年利率風險敞口？

No, Brian, this is Kirk. No, it's the revolver is basically the only interest rate exposure we have.

不，布賴恩，這是柯克。不，左輪手槍基本上是我們唯一的利率風險敞口。

Brian, you raise an interesting point, right? Our core business, setting MVP aside continues to perform well and generate significant free cash flow. So even with the heightened level of, I'll call it, burn rate for MVP, we will continue to delever at a slower pace, but the free cash flow remains constant and predictable so that while we need to bring MVP into service to execute on our larger plans, there's not a deterioration because we're generating such strong free cash flow quarter after quarter. Thanks for the question.

布賴恩，你提出了一個有趣的觀點，對吧？我們的核心業務（將 MVP 放在一邊）繼續表現良好並產生可觀的自由現金流。因此，即使 MVP 的消耗率提高了，我們將繼續以較慢的速度去槓桿化，但自由現金流保持不變且可預測，因此雖然我們需要讓 MVP 投入使用以執行在我們更大的計劃中，情況並沒有惡化，因為我們一個季度又一個季度地產生瞭如此強勁的自由現金流。謝謝你的問題。

That does answer my question. Thanks for just touching on those moving pieces as it relates to MVP and just the overall business as a whole. So I appreciate it, and enjoy the rest of your morning.

那確實回答了我的問題。感謝您觸及與 MVP 和整個業務相關的那些動人的部分。所以我很感激，並享受你早上剩下的時間。

Thanks.

謝謝。

And your next question comes from the line of Alex Kania from Wolfe Research.

您的下一個問題來自 Wolfe Research 的 Alex Kania。

Great. I guess maybe just comes down to the comments just on the uncertainty on federal permitting. I know previously, there was an expectation you'd have it some -- by the end of the year or early next. Is it just kind of a sense you're getting from the federal government just in terms of updated time lines that, that might be extended? Or is it -- I think maybe as you suggested before, it's a question of maybe when to see what goes on with permitting reform before kind of final permit's issued?

偉大的。我想也許只是關於聯邦許可不確定性的評論。我以前知道，有一個期望你會得到一些 - 在今年年底或明年年初。就更新的時間線而言，您從聯邦政府那裡獲得的感覺是否只是一種感覺，可能會延長？或者是——我認為也許正如你之前所建議的那樣，問題是什麼時候可以在最終許可證頒發之前查看許可證改革的進展情況？

Yes. Alex, this is Tom. I don't think there's anything specific that we're pointing to. We're just talking about just -- the current circumstances surrounding this project and that even when permits are issued, our ability to quickly dispense of the relentless litigation. If the federal agencies move the schedule a month or 2 either way, that's not determinative of our ability to complete the project within our guidance, as I said earlier.

是的。亞歷克斯，這是湯姆。我不認為我們要指出任何具體的東西。我們只是在談論這個項目的當前情況，即使頒發了許可證，我們也有能力迅速免除無情的訴訟。如果聯邦機構以任何一種方式將時間表移動一兩個月，這並不能決定我們是否有能力在我們的指導下完成該項目，正如我之前所說的那樣。

If we can get mobilized in the summer of 2023, we can bring the project in line for winter of 2023. I don't want to get hung up on are the permits issued on a specific date, but I'd like to frame the conversation in that regard.

如果我們能在 2023 年夏天動員起來，我們就可以在 2023 年冬天把項目安排好。我不想掛斷在特定日期頒發的許可證，但我想確定這方面的對話。

Got it. That makes a lot of sense. And then maybe just a question, just again thinking about the cash flow profile. Can you have kind of an updated sense now that we're through the EQT exercising its cash option, maybe how to think about deferred revenue maybe going into next year and kind of beyond just what the profile of that might look like?

知道了。這很有意義。然後也許只是一個問題，只是再次考慮現金流狀況。既然我們正在通過 EQT 行使其現金選擇權，您能否有一種更新的感覺，也許如何考慮可能會進入明年的遞延收入，而不僅僅是它的概況？

Yes, this is Brian Pietrandrea. So when EQT exercise their cash option, they're forgoing about $235 million of rate relief. So we factor that into our analysis. And we'll have 2024 guidance -- or excuse me, 2023 guidance later, but we did adjust for that and forgoing that rate relief going forward.

是的，這是布賴恩·皮特蘭德雷亞。因此，當 EQT 行使其現金選擇權時，他們放棄了約 2.35 億美元的利率減免。因此，我們將其納入分析。我們將有 2024 年的指導——或者對不起，稍後是 2023 年的指導，但我們確實對此進行了調整，並放棄了未來的利率減免。

Your next question comes from the line of John Mackay from Goldman Sachs.

您的下一個問題來自高盛的 John Mackay。

I just wanted to hop on. Thanks for second 1 here. In the past, you've talked about the potential to maybe look to go to a higher court above the appeals court and try to get some of these decisions reversed. Is that still an eventual possibility here if we continue to see bad news in the water permits?

我只是想跳上去。感謝這裡的第二個 1。過去，您曾談到可能會尋求上訴法院之上的更高法院並試圖推翻其中一些決定。如果我們繼續在水許可證中看到壞消息，這仍然是最終的可能性嗎？

Well, John, first of all, second round of questions cost more. So I'm not a lawyer.

好吧，約翰，首先，第二輪問題的成本更高。所以我不是律師。

I'll talk to Nate about that offline.

我會離線和 Nate 談談。

Right. I'm not a lawyer, but based on all of the input that we've received from the lawyers, there is nothing that is ripe for us to take to SCOTUS now that would solve the global issues in and of themselves, right? We have a series of individual permits from different agencies so that the difficulty is what do you take to the Supreme Court that actually is a comprehensive fix? So right now, as I'm going to sound like a broken record. But right now, we're going to continue to push to have the federal agencies, again, that we have really constructive and positive relationships with to reissue the permits and then get in front of that Fourth Circuit like we have so many times before and make the case that when is enough, enough, right?

正確的。我不是律師，但根據我們從律師那裡收到的所有意見，我們現在沒有什麼成熟的方法可以帶到 SCOTUS 來解決全球問題，對吧？我們有一系列來自不同機構的個人許可，所以難點在於你向最高法院提出的實際上是一個全面的解決方案？所以現在，因為我聽起來像是一張破唱片。但是現在，我們將繼續推動讓聯邦機構再次與我們建立真正建設性和積極的關係，以重新頒發許可證，然後像我們之前多次一樣進入第四巡迴法院，說明什麼時候就足夠了，足夠了，對吧？

When on the third round of the Biden administration issuing these permits, it's hard for us to fathom that this administration would be arbitrary or capricious in issuing environmental permits and that they're going to be issued in accordance with the law and the Fourth Circuit should follow the law and give deference to the agencies. So that's our plan of attack here, if you will, so that we can mobilize in the summer of 2023 and complete this project in winter 2023.

在拜登政府第三輪發放這些許可證時，我們很難想像這屆政府在發放環境許可證時會武斷或反复無常，而且它們將依法發放，第四巡迴法院應該遵守法律並尊重機構。這就是我們在這裡的進攻計劃，如果你願意的話，這樣我們就可以在 2023 年夏天動員起來，在 2023 年冬天完成這個項目。

And there are no further questions at this time. Mr. Tom Karam, I'll turn the call back over to you for some final closing remarks.

目前沒有進一步的問題。湯姆·卡拉姆先生，我會把電話轉給你做最後的閉幕詞。

So thank you all for joining the call today. And we're pleased that you have continued interest in the company. We will not rest and have no intention of resting nor do our partners until we complete MVP. That does not mean we're taking our eye off our core business, as you can see by the consistently strong results. So that, hopefully, in the very near future, we will bring MVP into service and the country will be better off and E-Train will be better off. Thank you very much. Have a good day.

感謝大家今天加入電話會議。我們很高興您一直對公司感興趣。在我們完成 MVP 之前，我們不會休息，也不會休息，我們的合作夥伴也不會休息。這並不意味著我們將目光從核心業務上移開，正如您從持續強勁的業績中所看到的那樣。因此，希望在不久的將來，我們將使 MVP 投入使用，國家會變得更好，E-Train 也會變得更好。非常感謝。祝你有美好的一天。

This concludes today's conference call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。