Williams expects more growth across the country


The strong showing that Williams Cos. had in the third quarter of this year is expected to gather steam in the coming months and at the same time, the Tulsa company made major gains in the Northeast part of the U.S. and in the D-J Basin of Colorado and Wyoming.

In a recent conference call with investors, Alan Armstrong, President and CEO declared, “We’ve delivered another quarter of strong financial performance even in the face of dramatically lower gas prices as compared to the third quarter of 2022….And we expect the strong performance to continue, providing us with the confidence to raise our 2023 guidance this quarter up by $100 million to $6.7 billion of adjusted EBITDA.”

Here’s how strong…its net income was $654 million or 54 cents a share, a gain of 10% compared to the third quarter of 2022. Adjusted net income was $547 million or 45 cents a share. Adjusted EBITDA was $1.652 billion,up $15 million from a year earlier. And cash flow from operations totaled $1.234 billion.

Why is Armstrong excited about the growth elsewhere? He told investors the company completed the first half of Transco’s Regional Energy Access project and full rate revenues started in late October.

“We expect the total project to be online in the fourth quarter of next year with the capacity to move approximately 830 million cubic feet a day of natural gas from the Northeast part of the Marcellus into the Pennsylvania, New Jersey, and Maryland markets,” explained Armstrong.

The company also completed the first expanson of its Cardinal gathering system for Encino’s rich gas drilling operations in the Utica play. Armstrong called the “really big news this quarter” the recent signing of agreements of more than 1.4 Bcf a day for the Southeast Supply Enhancement project to provide natural gas for the fast growing Mid-Atlantic and Southeast markets.

“So we are proceeding into the permitting process for this initial project due to the urgent demands to be met for this first group of customers. So in terms of impact, this will be the largest addition of EBITDA ever for a Williams pipeline extension yes, even more than our Atlantic Sunrise project and in fact, significantly more than the entire EBITDA generated from our Northwest Pipeline system.”

Those are also 20-year contracts which will run through 2047.

Williams also increased its business hold on the Rockies following the recent $348 million sale of its Bayou Ethane Pipeline system and a legal victory over Energy Transfer that added $495 million to the company books.

The funds will be used in the D-J Basin where Williams recently acquired Cureton Front Range LLC and its gas gatheering pipelines and two processing plants. It also finished acquisition of the Rocky Mountain Midstream following the purchase of KKR and its 50% ownership interest.

Armstrong said the acquisitions have a combined value of $1.27 billion and they will make Williams the third largest gather in the D-J Basin.