Good afternoon, ladies and gentlemen, and welcome to the NGL Energy Partners LP 4Q and year-end 2022 earnings call. At this time, all participants have been placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Linda J. Bridges, CFO. The floor is yours. Hi, welcome to NGL's fourth quarter and year-end fiscal 2022 earnings call. To start, I'd like to call your attention to our safe harbor language, which can be found towards the end of the partnership's earnings release, which was filed after the market closed this afternoon. Today's remarks may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In accordance with the act, I would also like to direct your attention to the Management's Discussion and Analysis section and the risk factors discussed in the partnership's annual report on Form 10-K for the year ended March 31, 2022, and in other SEC filings made by the partnership, which are available on our website and on the SEC's website. These, together with the safe harbor statement and the earnings release, set forth important factors that could cause actual results to differ materially from those contained in any such forward-looking statements. Looking back at fiscal 2022, our financial performance has started to produce results that reflect the quality of our asset base and validation of our strategy. Our Water Solutions segment saw tremendous growth in fiscal 2022 with adjusted EBITDA of $342 million, growing 42% or more than $100 million year-over-year as underlying volumes grew over 30% on a volume basis and as our skim oil sales benefited from higher realized crude oil prices. Fourth quarter volumes grew nearly 5% over the preceding fiscal quarter, and as expected, we exited the year at approximately 2 million barrels of processed volumes per day. The partnership reported total recycled volumes of approximately 34 million barrels for fiscal 2022. We expect processed water volumes for fiscal 2023 to average 2.2 million barrels per day, a level that we have already seen in May. Margin for fiscal 2022 totaled $0.46 per barrel, which includes disposal and skim oil revenue offset by OPEX per barrel. We believe this is a reasonable estimate for margin going forward. The liquids logistics segment reported total adjusted EBITDA for fiscal 2022 of $96.5 million. Our wholesale propane business had a challenging fourth quarter and full fiscal year due to lower volumes and margins as we experienced lower demand and increased competition in the areas in which we operate, as well as challenging market conditions related to a backwardated propane price curve over the course of our fiscal year. Despite a difficult year in propane, our butane refined products and biodiesel businesses performed exceptionally well with elevated margins due to tight supply markets, increases in demand for these products and favorable location differentials. As a whole, this segment should perform slightly better than this past fiscal year as we expect to see some rebound in our propane business in fiscal 2023 based off of current market conditions, as well as earnings from Ambassador Pipeline, which was not in service during fiscal 2022. Please remember, however, the majority of cash flow for the Liquids Logistics segment is and will continue to be generated in the second half of our fiscal year. Drivers include winter weather and agricultural demand for propane, gasoline demand, refining activity and market disruptions. Crude Oil Logistics reported adjusted EBITDA for the year of $146 million, which was higher than expected due to realized gains on the sale of inventory due to rapidly increasing crude oil prices. These gains are expected to be offset by approximately $12 million-$13 million of net realized losses related to commodity derivatives in the first quarter of fiscal 2023. Similar to what we saw in fiscal 2022, going forward, should we continue to experience a highly volatile crude price environment, we would expect to continue to see fluctuations in our quarter-over-quarter adjusted EBITDA numbers due to timing differences between the physical and financial settlements of inventory sales. Again, these fluctuations relate to timing, and any increase or decrease due to timing in a particular fiscal quarter will be offset in subsequent fiscal quarters, leaving the underlying business neutral. For fiscal 2023, we expect the underlying crude logistics business to perform relatively in line with fiscal 2022. Moving to the balance sheet, we repurchased approximately $86 million of unsecured notes during the fiscal year. The remaining majority of free cash flow generated in fiscal 2022 remains on the balance sheet, driven by an increase in inventory values due to higher commodity prices. Should inventory values decrease, we should see this cash flow come back to us, at which time we expect it will be utilized for debt reduction of the 2023 senior notes. Additionally, our distributable cash flow for fiscal 2022 includes approximately $55 million related to certain realized losses on commodity derivatives related to our previously discussed CMA differential roll hedge strategy that will return to the partnership in the form of realized gains on or before the expiration of the hedge strategy in December 2023. Liquidity on March 31st totaled $233 million. In light of rapidly increasing commodity prices, we proactively reached out to our bank group to increase our ABL commitment to accommodate higher working capital needs. Subsequent to the quarter end, our commitment was temporarily increased from $500 million- $600 million with full participation from our bank group. This increase, along with certain other initiatives being pursued, should give us sufficient liquidity to fund elevated working capital requirements as well as repay most, if not all, of our 2023 notes by the end of this fiscal year. While we're not prepared to discuss the specifics of these initiatives on this call, we hope to have updates in the coming months. With that, I'll turn it over to Mike for his comments. Thank you, Linda. Well, this is a very exciting time for NGL. We are turning the corner and have strong momentum going into fiscal year 2023. Our water solutions business is continuing to grow significantly. Our prior year's capital investment is fueling that momentum, allowing us to provide capacity to our upstream customers without delays. Before we get into the specifics, briefly review our current focus. One, prudent management of the balance sheet, reducing absolute debt and leverage. 2023s are the primary target. Two, reduce leverage below 4.75x In order to reinstate the preferred dividends and increase our financial flexibility. We will achieve this through a combination of reduced debt and increased EBITDA. Three, generate significant free cash flow from operations to provide the cash to repay the debt. Four, enhance that free cash flow by reducing working capital requirements, decreasing CapEx, and monetizing underutilized assets. While at the same time continue to pursue growth opportunities, leveraging volume capacity in our Water Solutions network with the minimal new investment. We do not turn down any water offered at a reasonable price. Due to the breadth and redundancy of our water pipeline system, our customers know they can depend on NGL when we commit to take their water. Now let's discuss fiscal 2023. Our EBITDA guidance is in excess of $600 million. We do not have an upper range as it could vary significantly depending upon the continuing strong commodity price environment. We are increasing our Water Solutions EBITDA forecast from $385 million to at least $400 million. The fourth quarter of the recently completed fiscal 2022 was the first $90 million EBITDA quarter for Water Solutions. We have clarity into the first quarter of fiscal 2023, where it appears we will realize our first $100 million EBITDA quarter. In terms of volume, the fourth quarter of last year averaged 1.93 million barrels a day, and we expect the first quarter of 2023 to average 2.2 million barrels a day, both excluding any recycled volumes. This is more than a 10% increase in just three months. Volumes in excess of this level during the subsequent quarters of this year could allow us to further increase EBITDA guidance. As a result of increased water volumes, we are capturing additional skim oil and realizing higher revenues due to both more volume and higher crude prices. At this time, we do not have clarity into the first quarter estimates for crude oil and liquids logistics segments as they have significant inventory quantities subject to the timing of physical versus financial results. In other words, hedge gains or losses versus the offsetting financial gains or losses. We are cautiously optimistic, but conservative at this time with respect to these segments, guiding EBITDA roughly flat for fiscal 2023. We will have the Ambassador Pipeline fully operational and in service connected to Marysville this summer, such that we will realize a full winter of performance this year from our investment in Michigan. Continuing with items that determine our free cash flow. Interest expense is about 95% fixed for NGL, so the increase in interest rates is not impactful. As we repay indebtedness, lower interest costs provide additional free cash flow each year of $15 million-$25 million, depending on the debt reduction. Regarding CapEx, due to our legacy investments, our CapEx should decrease annually. In fiscal 2022, maintenance and growth CapEx were $47 million and $75 million respectively, about $122 million. Fiscal 2023 is forecasted to be about 20% lower at $39 million and $60 million respectively. Approximately 50% of the growth CapEx in 2023 is committed to the new long-term produced water transportation recycling disposal agreement announced February tenth this year. This agreement contemplates a 24 in pipeline with four new SWDs and surface facilities. In addition, we are twinning the 30 in Poker Lake pipeline to provide combined capacity of the two 30 in lines of 700,000 barrels per day, plus a 16 in pipeline in SWD for a third customer. We are currently negotiating with additional producers that could result in further dedications and thus connections that would require some capital. We continue to monetize underutilized assets as every dollar helps reduce debt. We realized about $20 million of sales in 2022, and we are progressing towards another $20 million this year. In summary, we're expecting a strong beginning to the current year with the potential for an even stronger back half of the year. Finally, I would like to tell KJ 65 and JHH 2020 that yes, I am dancing. With that, we'll open up for questions. Thank you. Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments, please press star one on your touch- tone phone. Pressing star two will remove you from the queue should your question be answered. Lastly, while closing your questions, please pick up your handset if listening on speaker phone to provide optimum sound quality. Please hold while we poll for questions. Once again, that's star one if you have a question or comment. The first question is coming from Tarek Hamid with JP Morgan. Your line is live. Good afternoon. Hello. On the water business, obviously really strong performance. It's good to see the guidance of sort of above $400 million of EBITDA there. You sort of touched on a little bit in your opening remarks, but that sort of $600 million of total EBITDA less the $400 million of w ater EBITDA on the low end would sort of imply $200 million of EBITDA out of Crude Oil Logistics and Liquids Logistics. That clearly would be sort of down from about a little over $240 million in fiscal 2022. Can you help me just bridge us a little bit about how you're thinking about that? Is that sort of conservatism? Am I sort of being a little bit too precise with those numbers? Just any other color would be helpful. No. I think you're missing the offset of corporate expenses to that. That should bridge you. Okay. Yeah. I think what was our corporate overhead? Do we have that number? It was about $39 million. Mm-hmm. That would be your $40 million difference. Okay. Really just think about it as flattish in the crude. Yeah. Liquids Logistics. Yes. Second, on the CMA hedge, I think you talked about, you know, $12-13 million, if I wrote that down correctly, of expected EBITDA impact in the next quarter. Obviously the cash flow impact of the overall hedging program was pretty tough this quarter at about $90 million. I guess, can you sort of give us any color on what you expect the cash flow impact to look like of the commodity hedging program in this upcoming quarter? Yeah. I think we've mixed a couple of items. The $12 million-$13 million is the net loss on commodity derivatives that we expect to hit in the first quarter. Yep. That's to offset some of the gains. That's not relating necessarily to the CMA differential role. Without knowing what the price curve is gonna do, it's difficult to predict what the cash flow impact is. Typically, if you're hedging into a backwardated market, and prices are realizing on those hedges at higher prices, that would be a cash flow outflow, and vice versa on an inflow. Just sort of sense of how it should feel, what it will look like in this upcoming quarter relative to this last quarter? Not without knowing what commodity prices are gonna do for the next month. Okay. Fair enough. That's it for me. Okay. The next question is coming from Jason Mandel with RBC. Your line is live. Hi, guys. Thanks for taking the question. Obviously the outlook for the water business is really strong, but it seems like the next couple of quarters could be a little challenging from an outright total cash flow perspective, including settlements and everything, which I think, I guess as I understand it, is part of the $100 million increase on the revolver. Are there any other thoughts towards other levers to pull to give yourselves a little bit more headroom from a liquidity perspective, you know, asset sales or, you know, other capital structure moves? Yes, I think we've referenced it in the earnings comments, but we are working on a few different initiatives from both a liquidity and debt paydown perspective. We kind of specifically stated that we're not prepared to talk about those initiatives at this time, but we would hope to provide updates in the coming months. Okay. Thank you. Then this, the $100 million expansion on the facility, it sounds like that is just to give a little bit more breathing room over the next couple of quarters when working capital is more challenging and then I guess that facility drops back down early in 2023. Is there any hope or plan or expectation to extend that date or there's no need? Based on what we are seeing today, I would say that. Let me back up. The agreement is that we'll reduce that commitment back down to $500 million by March thirty-first of this next year. It really depends on what commodity prices do between now and then. The initial reason for requesting the additional hundred million was related to just higher working capital needs due to increases in commodity prices. If we continue to see these higher levels, we would most likely talk with the bank group going into next year. Okay. Very good. I'll hop back in the queue. Thanks for help. Mm-hmm. Up next, we have Robert Kane with Kane LLC. Robert, your line is live. Thank you. Good afternoon. I'm curious. I know the goal on the leverage ratio is 4.75x. Where are we right now? Right now, I believe we're right around 6.2x. Okay. If you look, we just posted an investor presentation that walks through where we expect to be, where we ended the year, and where we expect to be at the end of next year. Okay. All right. Very good. Do we have an earnings per share number on this quarter? Don't have that pulled up. It's gonna be in our 10-K, though. We would've posted that right after market closed today. Okay. I did look at that, and I didn't see it. All right. I thought you would have that number there available. Yes. I'll get it. We have that. Yeah. No, just check the 10-K. Okay. That's not a number we really pay any attention to. We pay attention to the free cash flow and the EBITDA. All right. Very good. All right, I'll take it. I'll take a look at that. That you've answered my question. Okay. If there are any remaining questions or comments, please indicate so by pressing star one. Up next, we have Robert Stetson, Private Investor. Robert, your line is live. Robert Stetson, your line is live. Hi. Thank you. I'm investor primarily in the preferred shares, and typically, when preferred shares are in suspension, when the dividend's being suspended, the preferred shareholders have a right to name one or more directors to the board. Is that the case here? No. No. Okay. The largest preferred share investor is EIG, and they have the right to appoint one board member, but it came with their investment, not because of the suspension of dividends. Do they have any intention of following through on that? Yes. They've had a board member since the day of the investment. Yes. Okay. Was the dividend suspended at the time they made the investment? Subsequent to the investment. Okay. They invested. They brought on a board member. You can check our board members. That member is Mr. Randy Wade of EIG, and he's currently on the board, and we expect he will be until they're repaid. Okay. All right. Thank you. Okay. The next question is coming from John Horton with VMR. Your line is live. Thank you. Good afternoon, Michael and Linda. I appreciate the opportunity. Last quarter, you gave a lot more color on the status of the Ambassador Pipeline. Do you have a couple of points that you would highlight now as far as the progress there? With the excitement that was noted by some of the retailers in the region, do you see a favorable contract situation for this next year that will help increase the growth? Sure. Well, Jeff Pinter is here, who runs liquids. He can give an update on both the pipeline connections, Marysville, et cetera, and then what we're seeing with the response from retailers. Good afternoon. Yes, the reception in Michigan has been very warm. We had the Wheeler terminal, which if you'll recall, was built about halfway up the pipeline in the center of the state, a little west of Saginaw. We completed that and brought it in service February first of this year. Customers were very excited to come to a you know brand-new facility with very efficient pump and truck loading system. We moved, I think, over 1 million gal the first month in service, and the reception's been great. The pipeline connection itself, we have the bulk of the line ready to go. We're finishing up some of the last pieces of the connection with DCP into their Marysville cavern. As Mike mentioned earlier in the comments, we expect that to be complete this summer and ready for winter service. Yeah. I might add, I would say the importance of the Marysville connection is that's a hub that produces a lot of propane, and that allows us to move propane up the line to Wheeler and then up to Kalkaska. This winter, we did not have that ability. We were having to bring rail in, and then we were limited by the production at Kalkaska in addition to that. This is a big, big change. Michigan has very few supply points. They're bringing product in from Toledo, Chicago, where else, Jeff? Detroit. Mm-hmm. So- Sarnia. Sarnia. The vast majority is by rail and truck. Right. From an environmental point of view, this is also a great asset because it's gonna eliminate a lot of truck mi. That was kind of a follow-up question to that. Do you have any estimates on what it's saving from an ecological standpoint? Well, you know, we look at, you know, emissions really from the transport. I don't know that we've got a number. Not that we're ready to share today. We are looking at it for the ESG benefits the pipeline provides. Yeah, it is a significant amount of efficiency gain. If you think about the haul from Chicago or Toledo to Northern Michigan and then returning empty, you're talking about 200-400 mi round trip and half of which truck's empty. Exactly. This much more efficiently brings product up there, and I'd say much more reliably. You know, roads can have potholes and wrecks and icy conditions. The pipeline will run smoothly and efficiently underground during the bad weather. Well, I was just thinking with the great relationship you have with the governor of Michigan, that they ought to appreciate all those efforts. I guess the next question, it's a very dynamic economic and materials environment that we're in right now. We look with many of our economists and the questions of will we have a recession, and will it be late this year or early next year? It puts a lot of question marks behind the business. It's good to hear that you've got an action plan in place that can help pay off a significant amount of debt by the end of March 2023. But in the, I guess the forecast you're considering, are you seeing anything in particular that you're not able to offset? Let's say if you see oil go back down to $65 a barrel, how does that change the dynamics of management's game plan? Well, on all three businesses we're seeing because of all these LNG demand, especially going to Europe, that we anticipate at a lower crude price, the liquids business will still do, you know, very well. A lower crude price will affect our crude logistics, which is primarily Grand Mesa. I guess the flip side of not seeing a large increase in volume there because it's fluctuated between nine and 12 rigs. Having a lower crude price probably doesn't affect the amount of crude being produced in that basin anyway. It comes down to the water side. How much at $65 will water? You know, will the rig count drop? You know, if I knew that, I could answer your question, but. Okay. I'm not trying to put you on the spot. It's just typically management strategic plans take into account a certain range of variables. Sure. Not trying to poke holes at it, just trying to understand it. Many of the people I think Wells Fargo showed a very flat future for NGL that would put in minds of investors the viability of investing, as far as it coming back to paying a dividend. That's a challenge for the common shareholder. Maybe the preferreds are looking and say, "Hey, great, we're gonna be back into money, next year late." For a lot of the common shareholders, there's still some questions left there. I think you mentioned maybe three or four quarters ago, the possibility that we don't see the price go back up until absolutely a common dividend is put back in place. Do you have any points where you can, you know, just add an opinion there professionally? No, we're really focused on the pref first, because you can't do a common increase until you know, reinstate the pref. Right. Our goal is to get that reinstated in 2023. Obviously, the 4.75x is the key to that. Then, you know, after that, we'll see what we do with the common units. Okay. Just trying to gain a perspective on how the common- Sure. Shares would be valued between now and two to three years from now. If it doesn't typically, you're not looking at the earnings per share, so it's not gonna follow a PE multiple there. Right. It may be completely flat then, and we have a lot of time to accumulate in that case. Thank you very much. Yeah. Okay. Thank you for your call. Okay. Up next, we have Khalid Jamil, Private Investor. Your line is live. Yeah. Thank you, Michael, for dancing. I appreciate that. It's a pretty sight. Yes. Couple of questions I had, and John Horton already covered, but, you know, question about the opportunities in Europe. I have not heard anything from management on that. Is there any significant opportunities you see in coming quarters, you know, export? Not from Europe, no. We don't export. I'll say this. We don't have any natural gas, so we don't export any LNGs. Because of the natural gas exports, more gas would presumably be produced, which would produce more liquids. That's where we would come in, moving propane and butane around North America. We do have the butane export facility in Chesapeake, Virginia. Okay. Yeah, crude, on the crude side, we transport to refineries. We do not export ourselves. Yeah. All right. No, I don't have any further question. Thank you. Thank you. Okay. Up next, we have James Yoon with Nomura. Your line is live. Hi. Thanks for taking my question. I was just wondering in your guidance, what you guys are assuming for crude oil prices? Can you provide any sensitivities for EBITDA and free cash flow on what happens if, you know, crude oil changes by like $5 or $10? Sure. The easy one is the skim oil. We've been running 120,000- 130,000 barrels a month. If you know, you times twelve, you have, say, your 1.5 million barrels. Then at $10, no, $10, that's $15 million. All right, a $10 drop would cost $15 million. You know, other than that, you know, it's back to what's the impact on the rig count, which would then impact our water volumes. Got it. You know, what are you guys assuming for crude oil prices in your adjusted EBITDA guidance? We haven't disclosed that specifically, James. Yeah, James, what we do is we grab the water projections from our customers. It's not a function of crude prices for us. We don't know what their drilling plans are at different, you know, crude prices. We do have their projections of water volumes for the year. Got it. Okay. I think, you know, CapEx for 2023 is a little bit higher just because, you know, that new acreage dedication. Just curious if there are any changes to your 2024 guidance you guys had, you know, provided, you know, late last year. No, we don't have any real changes. Hopefully, it's changing increasingly. We want it to increase from a profitability point of view, as we get more water. We want it to decrease from a debt reduction point of view. Linda would like to see it drop, and I'd probably like to see it go up a little. No change at this point, though, James. No. Got it. Okay, thanks. That's helpful. Just curious on the economics for the new acreage dedication you guys announced for the water business. Just curious like what the economics there look like for those volumes and, you know, what we should expect for, you know, margin per barrel as those volumes start ramping up. You know, we under our agreement, we can't disclose anything like that. I think in general, we could talk about where we see margins going. Is Doug White on the line? I'm here, Mike. Maybe you could talk a little bit about what we're seeing. We're seeing margins increase. Obviously, the oil price is very, you know, helpful to that. I know I think our previous call in February, we were asked about the revenue per barrel. Seeing that decrease a little bit. I think if we look now, we're seeing that turn around and increase. So I think it was $0.46 a barrel margin in our release. I think that'd be a good number to use, if you were, you know, plugging that into your model. We are seeing obviously revenue per barrel increasing along with the activity, also the limitation of capacity from our competitors. It's put us in a strong position to increase fees. Got it. I guess, you know, is the amount of skim oil you guys are able to, you know, grab from this dedication kind of like better than your current mix, or is that like in line with your current mix? I guess, how should we think about that going forward? In line. I think we were 15 basis points on the last call. That has ticked up a little bit in this current quarter. The completions activity drives that, of course. I think if you take that new dedication and just use our averages, you're gonna be very close to the right output. Got it. Okay. Thank you. That's all the questions I had. Okay. Up next, we have Oliver Moon with Moon Private Cap. Your line is live. Hey, guys. How are you? I'm calling you from Europe, actually. I'm here in Barcelona, Spain. So I'm very familiar with what's going on over here with Europe and the LNG market. You briefly touched on the butane export facility out of Chesapeake. I was really interested in knowing about that, if you guys did have any plans on doing any wholesale to companies out here in Europe. As I'm sure, next winter the need for butane and propane is gonna be quite high here. It's right, American gas prices are going through the roof, but if you can't convert it to LNG, you're not gonna be able to get it over here to Europe. You guys producing propane and butane being a liquid already in its liquid state should be able to get it over here. Excited to hear if you guys are doing anything at all to try to get that butane export facility going. That would be question number one. Then the next two are just really quick ones. Doug White, just wondering, do you hold shares in NGL Energy Partners? Because I've seen on the insider trading, I've seen Michael Krimbill buying up about 100,000 shares each quarter, and John Ciolek actually bought up some last quarter. I don't see Doug White on the list at all. Just wondering if you had any shares in the company. Third question, are there any sort of buyout, any worries that we should have, about near-term buyouts, buyout opportunities of NGL Energy Partners? The butane export facility. Doug White, do you hold shares in NGL Energy Partners? Are there any sort of, major asset sales or buyout conversations that we should know about? All right. I like it when you summarize, so I got them all. Doug, you wanna go first? I am very invested in NGL and this company. Awesome. Very glad to hear that because I've been looking online trying to find where your shares were, and I can't find them. Super stoked, man. I think, I'm fortunate that I don't have to report. Well, good to hear that you have 'em. That's all I wanted to know. Settles the soul a little bit there, buddy. Yeah. Thanks for that. Butane. Yeah, great question on Chesapeake. It is. As you know, it's a little closer shot to West Africa, the Mediterranean, and Europe from the East Coast of the U.S. than it is from the Gulf Coast. We like that. The facility is, I would say, nearly fully subscribed for butane exports through the fall, but we do have some capacity still for the winter. If there- There is traffic in and out of there? Sorry to interrupt. What's that? There is traffic in and out of that export facility? Correct. Yes. To where? To various locations. A lot of it lately has been going to West Africa. Okay. We have sent shipments to South America and the Mediterranean as well. Okay. I would say if there are interested parties to reach out to us, I'd be happy to talk about capacity for the winter. Is the partnership making money off of selling butane too? Like, would you guys be interested in more partners? 'Cause I can hook you up with Turkey if you want Turkey. I mean, I'm sorry to speak like that, but I mean I got a lot of money invested in your company. I wanna help us make money. How do we make this happen? How do we get that butane export facility working more? We have a- How do we sell more propane? Sure. Is what I'm getting at. 'Cause from what I understand. Sure. Sure. NGL Energy Partners has NGL Energy Wholesale, and we sell—we have 27 wells, I believe, that produce butane propane. We shouldn't wait for wintertime to sell to Michigan. We should be selling year-round, like, to everywhere. Sure. We have a international trading company that has, I guess. Anchored. Anchored our facility. We're not actually the company that's selling. We provide the facility and the butane to the trading company. I don't know what to tell you. Giving us the Turkey connections wouldn't. Just sounds like NGL Energy Partners is a wholesale. We wholesale butane and propane, correct? Yes. We just only do that in the United States. We don't do that. We're not selling to Europe. That's correct. The U.S. and Canada. Yeah, Jeff's speaking about our partner who is selling to these other countries. Correct. Yeah. Okay. Well, I'll send you guys a or make a phone call later to find out. Sure. If you guys wanna get. Yeah, I'm here. really just as a, I mean, just as an- Sure. A fully invested person in NGL Energy Partners, we're totally out of the woods in bankruptcy, right? I mean, there's nothing happening. There's no scares to come in terms of bankruptcy, right? That's correct. We're covering. Yes. That is correct. I mean, I'm not. I'm just speaking like a businessman out here. Like I'm telling you, I'm a businessman out here. I'm not a banker from New York. I'm just straight up European investor in NGL Energy Partners. Sure. We're solid. We're good. We just need more time. That is correct. Awesome, guys. If there was a problem, the outside auditors would have a qualified opinion, which they do not. Exactly. That's what we're trying to get to, though. Right. We're just trying to push. Water volumes need to go up, propane sales need to go up, and we just need patience and time, if I'm not mistaken. Correct. Correct? That's correct. Awesome. Hey, it's very good to put a voice, your voices to the call. Thank you for taking my call. Very appreciated. Have a wonderful day. Thank you. Okay. Up next, we have Edward Campana with Countryside Ventures. Your line is live. Good afternoon. I have a question about the Water Solutions business as it relates to the recycled water component of it. My understanding is many of your customers might wanna not only drill for more oil or complete wells to produce more, but also want to be as environmentally friendly as possible. What are you seeing now in terms of the demand for more recycled water? What kind of premiums can you get for that water, and as a means to enhance margins? My sense is that only about 20% of produced water that most large operators like yourself receive is actually recycled. This also kinda goes in tandem with more restrictions on, you know, permitting SWDs. Hey, Doug. Can I take that, Mike? Yeah. Yes, sir. That's a very good topic to bring up. You know, in Q3, we did 53,000 barrels a day last year. Q4, 146,000 barrels a day. In Q1, we're already outpacing that. We hope to get to 20% of all water. You know, that's over 400,000 barrels a day. We're very excited about that business. From a customer demand perspective, that business continues to accelerate. Everyone is getting comfortable utilizing produced water, even versus a year ago, in the completions process. I think there's a large runway there. You talk about margins, there's two sides to that coin, and I think you expressed it in the end. The less capital we have to expend for growth on disposal or even maintenance on disposal on wells is beneficial to us. We already see some of that benefit with our ability to sell water off of our system, certainly in areas of our system that may be heavily subscribed. That's a great benefit there. There's also an OpEx savings that goes along with that. On the revenue side, we continue to see the value increase as demand has increased. You know, there's water out there. You know, a year ago, people were giving water away off their systems. We have never done that. You know, we saw $0.10 a barrel. You know, we've done deals in, I guess, in May, you know, we were selling for $0.40 a barrel. We're seeing the increase in the value of our water, really increase from the revenue side, quickly, and also volumetrically. It is a feature. Keep in mind, we see that as obviously an ESG benefit. It's also a good fit with our customers because, you know, they get to promote their ESG and, you know, also because they care and taking the demand off the aquifers. It's also being generally accepted in the industry, most importantly, and it is cheaper than fresh or brackish water, so it's a win-win for all parties. We see that as part of our business, as a piece of our business. You know, NGL's core business is ongoing revenue barrels, which we used to say for disposal, but really, we're taking those barrels off the customer's hands so they can produce oil. What we do with that water subsequent to that is changing. Our core business and the numbers that we quote, like Mike did, in his opening, that's based on oncoming full fee revenue barrels for what has traditionally been described as disposal. The recycle and reuse barrels, you know, those do come at a lesser fee. They're not quite as impactful incrementally to our bottom line, but they are nice to have. Are you required to provide any reporting back to your customers regarding the delineating between what's being recycled and what's being injected into SWDs? As the water midstream operator, we do not have that. In New Mexico, the OCD, which is the regulatory body of oil and gas, they have requirements for operators to report those volumes, fresh versus or brackish versus reuse recycle. Great. Thank you very much. Okay. Up next, we have Craig Thomas with CWT Capital. Your line is live. Hi, everyone. Thank you for taking my call. Could you all help me in the Water Solutions business for water takeaway, about what percentage of the business right now is conducted in the spot market? Very, very little. On a percentage basis, we would assume that would be trucked water. That's the spot business. Trucked water is maybe 1%, 1%-1.5% of our total volumes. Very small. Is there a goal to get water that flows through pipelines to be more exposed to the spot business given that revenue is climbing? Yes. I think Mike mentioned that earlier. We have this calendar year added interruptible agreements to our portfolio that we've not had in the past. Those continue to roll in, and they will grow while we are in this high commodity environment. You know, everyone asked about our system and, you know, how utilized has our system been from a capacity basis, were we overbuilt maybe over the last few years. I think based on what we see with these new interruptible agreements, these agreements are anywhere from $0.80- $1.25 for fee. That's us capturing water that is committed to our competitors, but their systems are not built with the capacity or the throughput, and we're able to capture those barrels ourselves at those very high return fees. Right. Those interruptible contracts are not the trucking contracts because you have pipes that go across Texas, New Mexico, and multiple directions. I guess, is there more exposure then? Maybe I used the wrong word. Maybe it should be interruptible. How much of our business is now interruptible? Yeah. You know, growing this year, we had very few interruptible pipeline agreements prior to this calendar year. Now we're doing in the Delaware, and this is I'm speaking Delaware because that's where most of our business is. We probably have about 100,000 a day of interruptible barrels at that, the average of, I would say $1, you know, we're doing 2 million a day there now. You can do that. I got it. Good. It's gonna continue. Yeah, I imagine it would given earthquakes and issues with permitting disposal wells. That's a great strategic asset you all have. I guess it's a congratulations on having a great system. One little cleanup from the last quarter call. You all indicated on that call that Water Solutions did or was doing $30 million in January and February, and then was on track to kinda get to that $32 million level in March. I calculate that at $92 million. The call was at the beginning of February when oil was substantially lower, and obviously you were able to sell skim oil at higher prices for at least a month and a half, higher than it was when you had that call. I'm just curious, was there something one-time in the Water Solutions business in the last six weeks of the quarter, or were there expenses that maybe I saw your prepaid expenses climb pretty dramatically. Was there something that was kind of pulled forward from this now fiscal year that suppressed the EBITDA number a bit? Good. Can I speak to the March actual, Michael or Linda? Sure. Yeah. March actual was $34 million EBITDA. To answer your question, were there any one-time events or other accounting measures? It being year-end, GAAP accounting gets pretty focused on making sure that we've captured all of our accruals. There were some of those. We would have even outpaced $34 million in March, but there were some one-timers that in the quarter, really the GAAP accounting, nothing strategic or operational, just to wrap up the fiscal year. Got it. Are those things normal every year or they just kinda were underaccrued in the first nine months and then you caught up all in the fourth quarter? It would be the latter. Those are not typical or normal up to the magnitude that we had. They were just cleanups and catch-ups, from priors, but we would not expect the same magnitude in this new fiscal year. Got it. Well, that's good. That sounds like you're doing quite well. The exit rate of 34 was better than the 32. It would seem that if that's the exit rate, 34, you should do better than $400 million, probably dramatically so, given where crude is now. It seems like in your numbers, you all are assuming a very low number for the price of oil and skim oil, your realization. Is it like $90 you're assuming? It seems it could be that low. No, we're just trying to make sure we beat our numbers this year. Okay, I get it. I understand. I know you have some things in your business that keep you know, propane's a wild card always. You never know what you're gonna get. I understand. That one's a hard one to predict. We as investors certainly appreciate you hitting your numbers, so. Yes. I appreciate the conservatism. One final question and I'll let you go. Did you all say you're gonna pay off the $500 million notes due at the end of 2023 by the end of this fiscal year? Did I hear that right? I think there was $475 million outstanding at 3/31. We would expect free cash flow generated this year as well as cash flow generated from some of the initiatives that we alluded to earlier to get us to a point where we can either pay off or substantially pay off the 2023 notes by the end of this fiscal year. Oh, that's fantastic news. There's nothing in the pipeline till when? 2026 in terms of maturities, or is it 2025? There's a small tranche in 2025. Oh, wow. Okay. That's impressive. Final question, and I'll open up the queue for other people. How much debt has been paid off through kind of the end of May? Have you gone back into the market to repurchase the notes? That's not a number that we've disclosed. It'll come out in our first quarter Form 10-Q. Okay. Wonderful. Thank you very much. Good. Thank you. I would now like to turn the floor back to management for closing remarks. All right. Well, thank you guys for your participation in today's call. We'll look forward to talking to you guys in August when we discuss our first quarter 2023 numbers. Thank you. Thanks, guys. Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time, and have a wonderful day. Thank you for your participation.