Good day, ladies and gentlemen, and welcome to the second quarter 2022 Hess Midstream conference call. My name is Victor, and I'll be your operator for today. At this time, all participants are in listen only mode. Today, we will conduct a question and answer session. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to Jennifer Gordon, Vice President of Investor Relations. Please proceed. Thank you, Victor. Good afternoon, everyone, and thank you for participating in our second quarter earnings conference call. Our earnings release was issued this morning and appears on our website, www.hessmidstream.com. Today's conference call contains projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to known and unknown risks and uncertainties that may cause actual results to differ from those expressed or implied in such statements. These risks include those set forth in the Risk Factors section of Hess Midstream's filings with the SEC. Also, on today's conference call, we may discuss certain non-GAAP financial measures. A reconciliation of the differences between these non-GAAP financial measures and the most directly comparable GAAP financial measures can be found in the earnings release and our transcript of today's prepared remarks. With me today are John Gatling, President and Chief Operating Officer, and Jonathan Stein, Chief Financial Officer. In case there are audio issues, we will be posting transcripts of each speaker's prepared remarks on www.hessmidstream.com following their presentation. I'll now turn the call over to John Gatling. Thanks, Jennifer. Good afternoon, everyone, and welcome to Hess Midstream's second quarter 2022 conference call. Today, I will review the progress we're making on executing our strategy, discuss our operating performance and capital program, and review Hess Corporation's results and outlook for the Bakken. Jonathan will then review our financial results and guidance. Beginning with Hess's upstream results, today Hess reported second quarter Bakken net production averaged 140,000 barrels of oil equivalent per day, reflecting the impact of severe weather in April and May. Hess's production is recovering. Well results continue to meet or exceed expectations, and Hess anticipates production to build in the second half of the year as they bring approximately 50 wells online compared to 32 wells in the first half of 2022. Bakken net production for the third quarter is expected to increase to between 155,000 and 160,000 barrels of oil equivalent per day and further grow to between 160,000 and 165,000 barrels of oil equivalent per day in the fourth quarter. For full year 2022, Hess forecasts Bakken net production to average between 150,000 and 155,000 barrels of oil equivalent per day. Furthermore, Hess announced a fourth drilling rig commenced operations in the Bakken during July, supporting Hess's planned production ramp to approximately 200,000 barrels of oil equivalent per day by 2024. With Hess Midstream's focused gathering infrastructure expansion, we're ready to meet Hess's accelerated development pace, which is expected to drive volume growth through our system, allowing us to reaffirm our expected throughput growth above MVCs in 2023 and 2024. Turning to Hess Midstream's results. Our second quarter throughput volumes averaged 292 million cubic feet per day for gas processing, 93,000 barrels of oil per day for crude terminaling, and 65,000 barrels of water per day for water gathering. As physical volumes are already expected to be at or below MVC levels, there was no material impact to our second quarter financial results relative to our guidance. The weather-related deferral of planned maintenance activity to the second half of the year drove lower than anticipated operating costs for the second quarter, resulting in adjusted EBITDA of $243 million compared to our guidance of approximately $235 million. Turning to Hess Midstream guidance, which was included in our earnings release and is available on our website. We're reaffirming our previously announced full year 2022 financial guidance and updating our throughput guidance to reflect the impact of severe weather experienced in the second quarter. For full year 2022, we now expect gas processing volumes to average between 315 and 330 million cubic feet per day and crude terminaling volumes to average between 103,000 and 108,000 barrels of oil per day. Reflecting strong growth in operating performance, we continue to expect water gathering volumes to average between 70,000 and 75,000 barrels of water per day for full year 2022. As a reminder, with physical volumes on our systems expected to be at or below MVCs in 2022, our 95% revenue protection gives us a high degree of confidence in our financial guidance. Turning to Hess Midstream's 2022 capital program. We continue to make excellent progress on our 2022 capital program, with activities primarily focused on flare reduction through the continued expansion of our gas capture infrastructure. We recently completed construction and commenced commissioning of the second of two new compressor station startups planned this year. We expect to bring the stations online in the third quarter, completing the project below budget and several months ahead of schedule. In aggregate, our two new compressor stations provide an additional 85 million cubic feet per day of installed capacity in 2022 and can be efficiently expanded up to 130 million cubic feet per day in the future. As previously announced, we expect to initiate construction on a third compressor station in the fourth quarter, which would provide an additional 65 million cubic feet per day of installed capacity in 2023, further growing our capacity and supporting Hess's accelerated development. In addition, our close integration with Hess and lean, focused standard design philosophy has enabled us to largely mitigate near-term inflation and maintain full-year capital guidance. 2022 capital expenditures are expected to total approximately $235 million, comprised of $225 million of expansion and $10 million of maintenance activity. We expect to invest approximately $120 million in compression expansion and reflecting increasing drilling activity by Hess, approximately $105 million in gathering system well connects. In closing, we continue to execute our strategy, making efficient and low risk infrastructure investments to meet basin growth demands, delivering safe and reliable operating performance and strong financial results, enabling us to grow our business and return capital to our shareholders. I'll now turn the call over to Jonathan to review our financial results. Thanks, John, and good afternoon, everyone. As John described, we are making good progress in executing our strategy, and we are excited to support Hess's accelerated development in the Bakken while continuing to deliver on our strategy of consistent and ongoing return of capital to our shareholders. Over the past 12 months, we have executed in excess of $1 billion in accreted share buybacks, announced two separate distribution level increases, and continued our track record of growing our distribution per share every quarter since our IPO in 2017. We recently announced our second quarter 2022 distribution growing 1.2% quarterly, consistent with our targeted 5% annual distribution growth to Class A share through at least 2024, with expected annual distribution coverage greater than 1.4 x, including distribution coverage greater than 1.5 x in 2022. We expect to continue to execute our financial strategy over coming years as we have clear visibility to expected revenue and adjusted EBITDA growth, supported by increasing MVCs in the second half of 2022, followed by organic growth above MVCs in 2023 and 2024, underpinned by Hess's recent addition of a fourth operating rig. Based on our 2024 MVCs set as part of Hess's nomination at the end of 2021 at 80% of our expected 2024 gas gathering and processing throughputs, our volumes are expected to grow by approximately 20% relative to our 2022 MVCs. Gas revenues, excluding pass-through revenues, comprise approximately 75% of total affiliate revenues, emphasizing the visibility we have to continued growth in adjusted EBITDA. Looking forward, annual capital expenditures to deliver this growth plan through 2024 are expected to remain stable relative to 2022, with activity tightly focused on phased build out of compression, well connects, and system optimizations aligned with Hess's development plan. As a result, with growing adjusted EBITDA and stable CapEx, we expect growing adjusted free cash flow sufficient to support our growing distributions and incremental financial flexibility, allowing for continued return of capital to shareholders consistent with our financial strategy. Turning to our results. For the second quarter, net income was $152 million compared to $160 million for the first quarter. Adjusted EBITDA for the second quarter was $243 million compared to $242 million for the first quarter. The change in adjusted EBITDA relative to the first quarter was primarily attributable to the following. Total revenues, excluding pass-through revenues, increased by approximately $4 million, primarily driven by higher MVC levels, resulting in segment revenue as follows. An increase in processing revenue of approximately $3 million and an increase in gathering revenue of approximately $1 million. Total cost and expenses, excluding depreciation, amortization, pass-through costs, and net of our proportional share of [audio distortion] earnings increased by $3 million as follows. Higher operating and maintenance activity on our expanding gathering infrastructure of approximately $4 million, partially offset by lower G&A of approximately $1 million, resulting in adjusted EBITDA for the second quarter of $243 million above our guidance of approximately $235 million, primarily due to deferral of certain maintenance activities to the third quarter. Our gross adjusted EBITDA margin for the second quarter is greater than 80%, highlighting our continued strong operating leverage. Second quarter maintenance capital expenditures were approximately $1 million and net interest excluding amortization of deferred finance costs was approximately $35 million. The result was that distributable cash flow was approximately $206 million for the second quarter, covering our distribution by 1.5x. Expansion capital expenditures in the second quarter were approximately $70 million, resulting in adjusted free cash flow of approximately $136 million. At quarter end and following the completion of our recent unit repurchase, debt was approximately $3 billion, representing leverage of approximately 3.2x adjusted EBITDA on a trailing 12-month basis. By year-end, we expect the leverage to return to our 3x adjusted EBITDA target and decline below this target in 2023, providing flexibility for incremental return of capital to shareholders. Turning to guidance. We are reaffirming our previously announced guidance for full year 2022, for which we expect net income of $610 million-$640 million and adjusted EBITDA of $970 million-$1 billion. With total expected capital expenditures of $235 million, we expect at the midpoint to generate adjusted free cash flow of $615 million. As implied in our guidance, we anticipate adjusted EBITDA in the second half of the year to be higher relative to the first half, supported by MVCs that are generally increasing through the year. We expect third quarter adjusted EBITDA to be approximately flat relative to second quarter results as increasing revenues driven by higher MVCs are offset by higher seasonal operating costs, including maintenance activities that were deferred from the second quarter. For the third quarter of 2022, we expect net income to be approximately $150 million-$160 million and adjusted EBITDA to be approximately $240 million-$250 million. Third quarter maintenance activity, maintenance capital expenditures and net interest excluding amortization of deferred finance costs expected to be approximately $40 million, resulting in expected distributable cash flow of approximately $200 million-$210 million, delivering distribution coverage at the midpoint of the range of approximately 1.5 x. In the fourth quarter, we expect continued adjusted EBITDA growth relative to the third quarter on higher MVCs and expected lower seasonal OpEx. In closing, we are very pleased with the progress we are making in our business and look forward to a visible trajectory of growth in our operational and financial metrics that underpins our unique and differentiated financial strategy with a focus on consistent and ongoing return on capital. This concludes my remarks. We will be happy to answer any questions. I will now turn the call over to the operator. Ladies and gentlemen, if you have a question, please press star followed by one on your phone. Questions will be taken in the order received. Please press star one one to begin. One moment for questions. Our first question comes from the line of Stephen McGee from JPMorgan. Your line is open. Hi. Thanks for taking my question. For the 2022 volume guide, do you expect most of that to be made up in 2023? Did the fourth rig come online with expectations or did that pull forward any growth? Finally, would this provide any opportunity to raise the 2023 MVC level? Sure. Let me hit the 2022 question first. The rig came on in July. We would expect to see some wells coming out towards the end of the year, but we don't expect any real material volumes from the fourth rig. We do still continue to expect to see growth into the second half of the year and into the fourth quarter with the add of the third rig and then obviously with the fourth rig coming on. As far as looking at 2023 volumes, we are expecting to be above MVCs in 2023 and 2024. As we look further forward with the fourth rig, you know, we'll make adjustments to our guidance as we go into 2023 at the beginning of the year. Yeah. This is Jonathan. Just, you know, on the MVCs, just for clarity, just as a reminder of how that works is, you know, we set the MVCs three years in advance. Once they're set, they can only be increased and not reduced. As an example, at the end of 2021, when Hess updated its nomination, we set a new MVC for 2024, but then also went back and looked at our MVCs. In that case, the 2023 MVCs were actually all went up as a result. As John said, you know, we have growth going into next year. We'll set a new MVC at the end of this year for 2025, and then we'll look at the volumes for 2023 and 2024 to the extent that the volumes are higher than what's in our current nomination, then the MVCs would go up at that point. You know, as a reminder, the MVCs again can only go up, they can't go down. When we evaluate them, it'll only be for up, otherwise the MVCs that we have will stay in place. Got it. With your expectations to be above MVCs the next two years, is it fair to assume that there could be an increase in MVCs? I mean, I think we'll update that at the end of this year when we come out with our new MVC for 2025, and then we'll look back. I think the important point, which is what John highlighted, is that, you know, with the fourth rig now in place, obviously as well as our continued focus on gas capture and the zero routine flaring goal by the end of 2025, all that really supports visible growth for us and underpins the growth that's already implied by our MVCs. I talked about the 20% growth from this year's MVCs to the 2024 implied throughput. That's going to include growth next year as we move from MVCs to physical volumes and then continued growth in 2024 as we grow and expect to grow both gas, oil, and water volumes across, you know, really all of our systems supported by that. Remember, with that increasing revenue and our, you know, as I talked about, our consistent EBITDA margin that's gonna add stable CapEx that John and I both talked about, that's gonna translate into continued growing free cash flow after distribution and continued de-leveraging, which gives us the opportunity for continued return on capital. Got it. Thank you. Super helpful. Thank you. Thank you. One moment for questions. Our next question comes from the line of Doug Irwin from Credit Suisse. Your line is open. Hey, guys. Thanks for the question. Maybe just a broader one, kind of on the back end, with Hess adding a fourth rig, and I think we've kind of seen some other rigs start to come back kind of this summer. Just kind of curious if you see any capacity constraints developing in the basin kind of over the next few years. I guess specific to Hess Midstream system, you mentioned the ability to kind of further expand the recent compressors that came online. Is that a decision that might be needed kind of over the next couple quarters, or is that more of a longer term opportunity that you're thinking about? Yeah, sure. Maybe I'll just take the export question first. You know, I think overall, just speaking for Hess is in good shape. We have sufficient capacity to stay within flaring regulations, process and export oil, NGLs and natural gas. From our perspective, you know, we're in very good shape to support Hess and third party volumes. Then as we think about expanding our system, I mean, you know, we've over the years, we've built our system with maximum flexibility as efficiently as we possibly can. Our kind of design once build many approach, our lean focused approach, has enabled us to expand as the basin growth dictates. That includes Hess's growth. As Hess looked to add the third and ultimately the fourth rig, you know, we were well-positioned to be able to expand our infrastructure to support that growth. That will continue to be our philosophy as we develop the basin and support Hess and other third parties. We'll continue to look at infrastructure that can be expanded through that. From an overall infrastructure perspective, we're in good shape. We've got Hess covered. As Hess grows, we'll continue to look at infrastructure needs and demands, and we'll manage it from that perspective. you know, as third parties potentially grow as well, we'll look at opportunities to support them on their way to reducing flaring and Hess's objective of zero routine flaring by the end of 2025. Okay, that's helpful. Thank you. Maybe one on capital allocation, just kind of in light of the repurchase that took place during the quarter. I think it's been a pretty balanced approach in the past between buybacks and distribution growth. Just kind of curious how you're weighing those options moving forward from here. If there was maybe a certain level of public float you're looking to achieve, maybe there's a yield that you're targeting. Just kind of curious how you're thinking about that. Sure. Look, I think first of all, we got a lot of positive feedback on the recent combination of the buyback and the secondary offering. We won't always, you know, there's no plan to do those always together. It certainly worked out well. We're happy that the transaction went well. Really, you know, as I said in the past, they're really geared towards two different objectives with the buyback, part of our continuing and ongoing return on capital program, and then our secondary is really part of removing technical obstacles to ownership. You know, in terms of the secondaries, as we said, there's really no specific plan there, or targeted float. It's really, as I said, to remove technical obstacles. We feel good about the progress we've made there, in terms of liquidity measured by our increase in average daily trading volume as well as the increased indexation we've gotten by being added to the Alerian and the MSCI Small Cap Index. No specific plan in terms of secondaries. There's no targeted float. It's really a combination of demand that we get from investors who are looking to, increase their position and want to remove some obstacles and balance with Hess and GIP being disciplined investors who see the long-term value in Hess Midstream. In terms of the first part of your question, in terms of the balance between buybacks and, distribution increases, as we've done those, you know, really together, you know, I think those have worked out well and certainly as part of our continuing program. As you know, two parts to our ongoing return on capital. It's the 5% per share growth that we'll continue to at least 2024, and we'll update more on that at the end of the year when we give out guidance for next year and our MVC for 2025. The incremental return on capital, including the share repurchases, and we'll be able to combine those really with distribution increases that really maintain the same level of distributable cash flow but on a lower share count. That has allowed for really ongoing and immediate return on capital, both in terms of the buyback combined with the dividend increase. Those are certainly parts of our program that will continue. Secondary will be really when you see that balance between demand from investors and Hess and GIP's long-term value perspective relative to their own disciplined holding. Great. That is, all for me. Thanks for the time. Thank you. One moment for questions. Our next question comes from the line of Praneeth Satish from Wells Fargo. Your line is open. Thanks. Good afternoon. I think based on your MVC cadence, it sounds like you'd start to hit 90% of your processing capacity in the 2025 timeframe. I guess if that assessment is correct, would you consider expanding processing capacity at that point? Or is it kind of dependent on whether Hess moves past its 200,000 barrels per day target? Yeah, thanks. So we haven't actually given 2025 MVCs yet. So it sounds like you're maybe kind of forecasting that growth out beyond 2024. We're obviously expecting to be above MVCs in 2023 and 2024. We feel like we have sufficient capacity to cover Hess's plans. You know, we'll continue to evaluate the needs in the basin. Our focus right now is just on gas capture and adding the compression necessary from a processing perspective. 500 million cubic feet per day capacity covers our current plan. But we'll continue to look at that. We'll look at Hess's plans with its fourth rig and the performance that it expects to see there. We'll also look at third parties to understand what the demand is, and we'll kind of take it based on that. I mean, from our perspective, from an execution perspective, you know, we're prepared to plan and engineer whatever infrastructure we need to support the basin. But again, we want that to be right-sized, fit for purpose, and make sure that we've got good volumes accounted for going into this any system that we build. Got it. Maybe if you could just comment on kind of the puts and takes of where you think rates could go in 2023. I mean, I know you've got some inflation tailwinds, but then you know, you've got weather-related disruptions, but then you've got better volumes in 2023 'cause of the fourth rig, potentially. I guess just net-net, just directionally, would that support higher rates in 2023 or kind of flattish? I'll let. Man, I think. Yeah. Yeah, go ahead, Jonathan. Go ahead. I'm open. Okay. Sorry about that. Okay, thanks. No, I think that, look, I think as you said, there are puts and takes to this. I think, you know, our plan, we did have a big increase in rates in 2021, and then as we've kind of set the plan here, which includes growth, you know, we've really been saying about the fourth rig, is what really underpins the growth that's in the existing plan. We do have capital that has, you know, been tied to the plan to, you know, add additional compression and the like. I think, look, our expectation is generally that, you know, rates will obviously we have an inflation escalator, but, you know, net-net of that, we expect rates to be, you know, relatively flat, maybe slightly, you know, increasing with the inflation escalator. besides that, you know, we're not expecting a big move in rates. That's really the big driver, really into 2023 will be as we continue that growth underpinned by the fourth rig, continuing gas capture, and that really will continue to drive up our EBITDA and our revenue as I described. Got it. Thanks. Thank you. Thank you. We'll move to our next question. Sorry. Our next question comes from the line of Michael Lapides from Goldman Sachs. Your line is open. Hey, guys. Thanks for taking my question. One or two easy ones. I just wanna make sure I heard correctly. 2023 expansion capital, are you saying it's gonna be roughly flat to the 2022 level? Can you just, given the number of compressors you're doing this year and the third one you're planning on starting kind of end of year, beginning of next year, can you just talk about the components of that? Sure. Maybe I'll just start with the compression question, and I'll hand the first part of your question over to Jonathan. You know, it really comes down to phasing, when the compressor started. You know, the compressors that we're bringing online this year, some of that spend actually happened last year. Some of it's happening this year. We're gonna be kicking off that third compressor station this year, and the bulk of the spend for that activity will actually be next year. From an overall compression perspective, we're gonna expect to see that spend relatively flat, and that holds for the broader program as well, generally looking at 2022 into 2023. I don't know, Jonathan, if there's anything else you wanted to add to that. No, I think that you know, we're really saying, look, you know, stable CapEx through next year, as John described, and then, you know, that but with that complemented by growing EBITDA, supported by the growing revenues as we've described. Obviously therefore, growing free cash flow after distributions and continuing de-levering. On the CapEx side, yeah, right now we're saying a stable base then as John described. Got it. A little bit of a quirky question on what happens with the tariffs once you know, once you get in the second 10-year process. Just curious. Tariff, you know, volumes were tough this quarter due to the weather in late April, early May, but because of the MVCs, that implies a higher tariff. If I remember correctly, when the, you know, when the next tranche occurs, it takes the average of the prior three-year tariffs and then grows by an inflation adjuster. Just curious, is what happened in this quarter actually a potential positive if I think out two or three years? I think the way as you described, we'll have a rate reset at the end of this year. The average rates for 2021, 2022 and 2023 become the set rate plus the inflation escalator for 2024. To the extent that volumes on a total basis for the year are lower than expected, then, you know, yes, that would have a positive impact on rates. As I said, though, I'd say maybe a little bit before, I think our expectation maybe even with this, you know, trend that we've had just in the first half, you know, we do expect growth the second half, is we still expect rates generally to be stable going into next year. So that will really, I think, you know, really just we're not expecting that to have a big impact. Really the big impact I'd say on rates that we've had occurred in 2021, as rates went up, you know, relative to where they were in 2020. That really fed into therefore our average going forward. This year, you know, volumes are really kinda at MVCs, and so therefore, you know, once you're at the bottom MVC, you can't lower volumes, lower MVCs don't impact rates going forward. Really, you know, again, expecting kind of stable rates going to next year and then, you know, really that'll roll into our 2024 rates. Got it. Thank you, guys. Much appreciated. Absolutely. Thank you. Thank you. Thank you very much. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a great day.