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Jeffrey Jewell

Thanks, David, and good morning, everyone.
As David mentioned, we delivered overall 2024 adjusted EBITDA of $969 million, an increase of 5% over the prior year, supported by our Pipeline segment's 7% growth year-over-year, which was driven by new LEAP expansions and higher storage revenue.
For the fourth quarter, we delivered overall adjusted EBITDA of $235 million. Our Pipeline segment was in line with the prior quarter, driven by increased seasonal demand at our storage facility and on our JV pipelines, offset by transaction costs related to our Midwest pipeline acquisition.
Our Gathering segment results were $6 million lower than the prior quarter, driven by producer deferrals of production to Q1 of 2025 and a key producer customer unplanned outage, resulting in lower Haynesville volumes. Operationally, for the quarter, total Gathering volumes across the Haynesville averaged just above 1.4 Bcf per day, down from the third quarter, driven by the deferrals and the key customer outage I previously mentioned.
Volumes in the Northeast were flat quarter-over-quarter. In 2025, volumes appear to be responding positively to the improved natural gas price environment with Haynesville volumes averaging 1.6 Bcf per day thus far in the year.
Now moving on to our financial outlook for 2025 and beyond. As we have done in the past, we are providing the current year guidance as well as an early outlook for next year. For 2025, our adjusted EBITDA guidance range is $1.095 billion to $1.155 billion, representing 18% growth from our 2024 original guidance.
Our 2026 early outlook range for adjusted EBITDA is $1.155 billion to $1.225 billion with the midpoint representing a 6% increase over the 2025 guidance midpoint. Our adjusted EBITDA guidance for 2025 and 2026 is supported by the incremental contribution from our growth investments, including the integration of our recently completed Midwest pipeline acquisition, as well as expected activity from our major customers.
Longer term, we continue to target adjusted EBITDA growth of 5% to 7%, which is supported by our $2.3 billion organic backlog, advantaged asset positions, strong balance sheet and our high level of take-or-pay contracts. Our 2025 growth capital guidance is $400 million to $460 million.
For 2026, we expect the level of growth investments to be in line with 2025. We currently have approximately $60 million of committed spend in 2026 and are working to advance a number of organic growth opportunities to FID.
Our Board has declared a quarterly dividend increase to $0.82 per share, which represents a 12% increase. This increase is supported by our higher adjusted EBITDA following the Midwest pipeline acquisition and its larger opportunity set and earnings base. Our approach to the dividend has not changed as we plan to continue to grow it annually, in line with adjusted EBITDA growth, and we are committed to maintaining a coverage ratio above our 2 times floor.
From a balance sheet perspective, we are pleased with our positioning on leverage and progress or obtaining an investment grade credit rating. As David mentioned, we received positive reaction from the rating agencies following our recently completed Midwest pipeline acquisition and are on positive outlook with both Moody's and S&P in addition to Fitch's investment-grade rating.
Our debt maturity profile has a weighted average maturity of approximately seven years and we are forecasting 2025 year-end on-balance sheet leverage of 3.1 times and proportional leverage of 3.9 times. We continue to execute our plans we have shared with the rating agencies and expect to be upgraded to an investment-grade credit rating in 2025. Our cash flows continue to remain strong, funding our growth investments, and we continue to expect to be a minimal cash taxpayer until 2028.
And with that, I'll now pass it back over to David for closing remarks.

David Slater

Thanks, Jeff. So in summary, we are highly confident in delivering on our full year guidance for 2025 and early outlook for 2026, continuing a track record of strong performance.
Looking forward, the market fundamental supporting our pipeline business are very positive. It certainly feels like we are entering a golden age for energy infrastructure investment. Our pure-play natural gas pipeline asset portfolio is very well positioned to take advantage of this opportunity, with our integrated assets providing critical capacity to premium and growing demand markets. We continue to remain laser-focused on advancing our sizable organic project backlog, delivering long-term value creation to our shareholders and supporting a reliable growing dividend.
And with that, we can now open up the line for questions.

Question and Answer Session

Operator

(Operator Instructions) Michael Blum, Wells Fargo.

Michael Blum

So before I -- I definitely want to ask about the two new projects. But before I do, I just want to level set, you have been, I think, before talking about six or more potential lateral data center-related projects that you have been pursuing, I thought those were behind the meter. So I guess the first question is, are the two announcements today which are in front of the meter in addition to those or those part of what you've been pursuing?

David Slater

No, those are new and in addition to our behind-the-meter opportunities, Michael. So these -- I would call these utility scale, direct utility scale power generation opportunities.

Michael Blum

Great. Perfect. And then on the projects, I'm just wondering on the Midwest and Appalachia projects, anything you can give us in terms of CapEx, expected returns? And then for the Midwest project, what the length of the contract would look like.

David Slater

Yeah. I'd say, we'll start with the one-off Midwestern. It's -- we're going to build a relatively short lateral over to this facility. And the customer is committing to long-term firm capacity on the mainline. We'll build this under a blanket authorization.
So that will give you a sense of the capital size here. It's fairly modest from a capital perspective, but layers on a really nice long-term load onto the network that we're really excited about. And this transaction happened literally right out of the gate with the new assets. So I'd say we're really pleased two months into it with how we view these assets coming into the portfolio and the opportunity set that they're going to provide, and that's all reflected in the increased backlog that we've disclosed to the shareholders today.
If we switch over to Appalachia, that project has been in the works for a number of years with a large power developer. It's in the PJM queue. It's also been through the West Virginia PSC process. It will hang off of the Stonewall system and have a firm capacity across the entire network, our gathering network, both Stonewall and Appalachia gas Gathering system. And again, it they haven't FID-ed the plant yet.
So they expect to do that early next year. And then we would commence construction to serve that plant. And again, that's a long-term contract, a 20-year contract, with a brand-new combined cycle power plant that sits in a really nice spot inside the PGM system.

Operator

Theresa Chen, Barclays.

Theresa Chen

For the broader updated $2.3 billion backlog, can you just remind us your expected returns and any sort of like economic terms on these projects as well as the process that you're pursuing from here?

David Slater

Sure, Theresa. I think we've pretty consistently been sharing 5 times to 8 times multiple in terms of proxy for the returns on these projects. And nothing has changed there. So obviously, we're trying to get the lowest multiple possible on all of our projects. But I think that band is a good calibration for the investors in terms of how we view our capital deployment. And the two projects that we announced today comparably fall into that band.

Theresa Chen

Got it. And on the macro front, on the heels of the weather tailwinds, the LNG feed gas spread being higher, the drawdown of inventory, better pricing as a result, based on your conversations with your producer customers, what are your views on the pace of production recovery across your footprint from here through the remainder of this year and into next? Maybe just kind of asking what does the near-term look that's analogous to slide 28?

David Slater

Yeah. Why don't we just talk about this year? Because I'm not sure that many of the public producers are even talking about next year yet. So I think the way to think about it for our guidance is we are expecting to see Haynesville volumes ramp over the year in our portfolio and I think Jeff mentioned it in the call in his remarks this morning that we're already seeing a ramp from kind of the exit rate in '24 to where we are today.
And then we're expecting Appalachia volumes to be relatively flat across the footprint. It's different by system. We have four different systems in Appalachia. But generally, Appalachia looks about flat across the year, embedded in our '25 guidance. So that's kind of the feedback we've been getting sort of at the end of last year from our producers.
Now there's been a lot of fundamental changes in the market over the last two months, and I alluded to some of those in my opening remarks, so obviously, we're going to work closely with our producer customers to see if they're going to adjust their plans or not as they kind of look forward at the gas markets and the pricing for the balance of this year and next year.
But I'd say, just generally speaking, it's been a very positive shift in sentiment around natural gas and their feelings around their business as a producer. But I do think, especially for the publics, they want to give a little time to make sure that that pricing remains intact. And -- but that's just my sense of the multiple conversations we've had with all of our producer customers in our Gathering segment.

Operator

Spiro Dounis, Citi.

Spiro Dounis

Want to go back to the capital plan quickly. David, I think you referred to these projects is highly probable, and so just curious if you could just give us a sense of the magnitude of the projects maybe sitting behind what was announced today and how much room you think there is to add to this backlog while staying within your free cash flow? And second part of this question, I just want to make sure, have you assumed that some of these data center projects are in that $2.3 billion? Or would they be additive?

David Slater

Yeah. Spiro, great question. Maybe I'll start at the highest level. And I'd say now that we've closed the acquisition from ONEOK, that opportunity set which has come to us through that acquisition is more significant than we thought when we originally announced the transaction. So there's quite a backlog of opportunities that are presenting themselves around those assets.
And that's reflected in our backlog. And in particular, it's reflected in the fact that 70% of that backlog is sitting in the Pipeline segment, which we love because it's high-quality projects. The one that we just talked about this morning is sort of the first of a series of projects that we're working on there.
In addition, the modernization opportunity set that we envisioned pre-close is even more robust than we thought post close. So that investment opportunity is in the backlog and it's very significant versus maybe the last time we publicly chatted to the investors pre-close. So giving us a lot of confidence in that backlog. And you kind of said it, Spiro, this is a probability weighted backlog that it's not the gross number, it's the highly probable number.
So there's a significant set of opportunities in addition to what we've just disclosed that I think over time as we work on them, they could get pulled into the backlog. So I'm really optimistic about the opportunity set in front of the company right now.
We've got really favorable sentiment right now in the market, both on the regulatory front and on the political front and in the general population sentiment front. So again, I don't want to get too far ahead of ourselves here, but everything is aligning nicely right now to create a nice runway for the company over multiple years. So I think make some significant investments in our Pipeline segment. So we're really excited about that, Spiro.
Turning to the power generation. We kind of intentionally wanted to unpack that for the investors in the slide deck and really differentiate that opportunity set between what I'll call utility underpinned power demand growth and then behind the meter data center power demand growth. What we've been observing in the last three or four months as many utilities, especially up here in the Midwest, have directly captured some of the data center demand and as a result of that, are initiating what I call utility scale gas-fired power generation projects.
We're very excited about that, obviously, because many of those utilities are customers of ours on the pipelines already. So there seems to be really two emerging trends that we're seeing in our footprint, both the data center trend, which we've talked about at length, and that's very robust and continues to be robust. And we're really just waiting on site commercialization for all the pieces to fall into place to be able to FID some of those projects. and this emerging utility scale power generation opportunity that's presenting itself sort of at the same time. So very excited about that.

Spiro Dounis

Great. Helpful color, David. Second question, just pivoting here to the Utica. Sounds like that's going pretty well. I think you said exceeding expectations.
So I wonder if you could just dial that in a little bit more and maybe give us a little bit of color there around the outlook. And you also did mention the possibility for downstream opportunities. I just want to make sure I understand what that means. Are you looking to maybe get into the processing at some point? Or are we talking about downstream into the transmission side?

David Slater

Yeah. It's really -- my reference was to transmission side, Spiro, as a potential downstream opportunities as these points ramp. I expect these producers will want to have a pathway out of the basin at some point. So that will present opportunities for us with our transmission pathways out of basin. And then in terms of where we see this part of our business going in '25 and '26, I'm highly confident.
And again, I can't speak on behalf of public companies here, but highly confident that there's going to be growth and a focus on these resources and continuing to develop these resources. So we're hand-in-hand with our anchor customer here working to line out those expansion plans and make sure that the infrastructure is there for them as they continue to develop their resource base.

Operator

John Mackay, Goldman Sachs.

John Mackay

I wanted to move to the Haynesville. You guys have talked in the past about your ability to take market share down there. I guess I'd just be curious where you guys stand now in terms of where you think DTM can grow versus the broader basin on both Gathering and then also on further LEAP expansions?

David Slater

John, great question. Nothing has really changed in that regard. We're highly confident in our ability to continue to grow that network like we have over the last three years. There's lots of infrastructure discussions being had in the public domain right now around the Haynesville and the Gulf Coast markets, which as I look at that, the demand is showing up and the market is recognizing that the demand is showing up. And there's lots of infrastructure projects being discussed publicly to connect incremental supply to that new demand that's showing up. So the confidence level and the demand arriving is high right now.
So I expect that we will continue to win our fair share of the market share as this continues to develop over the back half of the decade, just like we have over the past three years. I'm really proud of the fact that our system is the most highly interconnected system period out of the basin in terms of supply connectivity and market connectivity, and I believe that's appreciated by all the market players and that's why we've been able to keep peeling off expansions kind of consistently over the last three years.
We're obviously working on the next one. And as we -- once we contract that, we'll start working on the one after that. And we've got a nice runway of capability with that asset set. And again, we can continue to expand in nice bite-sized pieces that comfortably fits into what the market wants. And I think that's just one of the competitive advantages in addition to feature that we have across the footprint. So that will be the plan to keep chipping away at it going forward and just keep winning our fair share of the growing market demand.

John Mackay

I appreciate that. And maybe just staying down there in Louisiana. Mind just giving us an update on CCS. I think we're seeing the timeline push a little bit. I know there's a lot going on in the broader regulatory side.So maybe just an update there.

David Slater

Yeah. So I'll start with the positive is that the application requirements were finalized by the State of Louisiana. So that was slowing everything down last year. So that's kind of done, and we're over that step. So now the application is complete, it's really sitting with the state and we're in the waiting period now for the final Class VI permit. As soon as we have that in hand, then you should expect that we will FID the project and at that point, begin to spend what I'll call material amounts of capital to construct the project.
We're obviously talking to the states pretty much weekly now, trying to get a sense of timing from them. And I'm not going to predict their timing anymore because I've been predicting it for the last 12 months, and I -- they always underwhelm in terms of what they see versus what they do. And I'm just being transparent with you because I know everyone is wondering about this.
So we're applying steady, patient pressure to the state to move things along. The application is complete. We have a lot of local support for our project. All the critical pieces are in place and ready to go, it's just the permit at this point. So stay tuned.

Operator

Keith Stanley, Wolfe Research.

Keith Stanley

Just one clarifying question. For the lateral project on Midwestern and for growth projects generally on the new interstate pipeline assets, do you expect recovery to come from FERC rate cases? Or can some of these projects be done with bilateral contracts? And then related to that, just curious your expected rate case cadence for those new assets?

David Slater

Yeah, great question. So initially, there'll be new incremental contracts to support these investments. And then when that particular asset comes into the next rate case, obviously, that capital and that rate base rolls into your next rate case and is part of the next rate case process. So that's how it will play out for the FERC assets.
At some point in the future, they all will go into some type of a rate case process, whether it be like a negotiated settlement or whether it be a full rate case process through the FERC. So that's how you should think about it in terms of the capital deployment.
But again, in all cases, we're -- we have certain return expectations. The rate case process when that does play out as part of the economic assessment when we determine whether we're going to make that investment up front or not. So that's all folded into what I'll call the hurdle rates and the return expectations on the project when we initiate an FID to the project upfront.

Keith Stanley

Great. And any timing you're expecting just for rate case cadence or frequency on these assets?

David Slater

Yeah. All three of those assets are on a different rate case cadence. And I don't want to -- I don't have that handy in front of me, and I don't want to guess at it for you. So I'm going to ask you to follow up with Todd offline, and we can get you those details. But I don't want to quote it and have it quoted wrong here.

Operator

[Zack Van Everen].

Zack Van Everen

Just one on Midwestern lateral. It looks like you guys were able to get this in service relatively quickly due to the FERC blanket authorization. Do you have that authorization on any other assets? Or is it just this pipeline?

David Slater

No. Every one of the FERC assets has a blanket authorization capability.

Zack Van Everen

Okay. So when we think about -- because generally, on the FERC side, a lot of people know 1 to 2 years in permitting and one is here to build depending on size. Will your projects relatively be a little bit faster than that due to the authorization?

David Slater

Yeah. If we can get projects in under the blanket, those projects can go a lot swifter than going through the full process with the FERC, as you just highlighted. So yeah, this one was like literally a [niner] and off the main line. So it was -- it's a very short easy build over to this facility, which allowed it to go super quick, like literally right after we close the transaction this opportunity presented itself.
And yeah, so we're super excited about this, right out of the chute. We've got our first power deal on these new assets. And as I alluded to, there are more to come that we're working on behind this so.

Operator

Robert Mosca, Mizuho Securities.

Robert Mosca

So on the AGS lateral project, I understand that hasn't been FID-ed yet, but is there a potential for DTM to be a part of a CCS solution there? Has that come up at all in conversations?

David Slater

We have been having a CCS conversations with a handful of power developers in the Appalachia, the -- what I'll call the broader Appalachia region. So it's very very much in the forefront of their minds right now.
That being said, with the new administration and what we believe is a relaxing of the rules around new gas-fired generation, it may not be a requirement perhaps as some thought a year ago. So my sense right now is that the developers are pivoting more towards what I would call a conventional combined cycle footprint, but have the optionality in those facilities to either over time introduce a hydrogen blend or build the facility in a way that over time, if they needed to, they could capture carbon off the back end of the plant for sequestration again, over time.
So a lot of the developers are looking at trying to engineer in the optionality to decarbonize the facility over time, which I think is a smart approach, just given how the sentiment in the market and then the nation can swing back and forth on this particular topic.

Robert Mosca

Got it. No, that's helpful. And then maybe turning to the Haynesville. I think your main producer there has noted that they want to be flexible in terms of their production plans. How does that look in terms of the conversations you have month-to-month or quarter-to-quarter.
I'm just -- should we think about it differently than this is the plan that you have kind of exiting '24 and just how dynamic that could be over the course of '25?

David Slater

Sure. Well, again, I just have to be careful here because, as you know, our largest customer is a public company. So what I'll say generically, and maybe I'll repeat what I said earlier, is that we expect volumes across our network so the gathered volumes directly from our producer customers, which we have many, will grow over the course of the year. And we've actually seen them grow significantly since the exit rate in 2024. So some of that growth has already occurred, which is positive, right? It's what I would have expected given the -- how the market is shaping up right now.
So we'll see as the year progresses and as producers get progressively more confident with pricing and get more confident with the demand that's showing up. Again, a lot of producers, and I think they've said this publicly, they want to see the demand. They want to see it, feel it and experience it before they start to deploy capital to growing some of their production. So I really think we're in a little bit of a wait-and-see mode.
Having said that, nat gas prices today are probably $0.75 higher than they were three months ago. which is a pretty significant upward move, which certainly is supportive for their businesses. So we're just being patient. We see growth. We have growth in our plan. And we'll see how that evolves as the year unfolds.

Operator

There are no more questions. I will now turn the conference back over to David for closing remarks.

David Slater

Well, thank you again for joining us. We certainly appreciate the support that you've shown to the company and look forward to delivering another strong year. Thanks, everybody, and have a great day.

Operator

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.