Tallgrass Energy, LP (NASDAQ:TGE) Q2 2019 Earnings Conference Call - Final Transcript
Jul 25, 2019 • 03:30 pm ET
Gary J. Brauchle
this segment was higher distributions from our 75% ownership interest in REX, which were largely the result of the lower interest expense at the REX level and the increased rate on the Encana contract and that rate contributed for full quarter in Q2.
For the Crude Oil Transportation segment, adjusted EBITDA was $90 million for the second quarter, which was approximately $9 million higher than the first quarter of '19, primarily as a result of higher average transportation volumes in the segment. The quarter on Pony Express averaged approximately 348,000 barrels per day, compared to 336,000 barrels per day in the first quarter.
As many of you know, Pony Express was shut down for eight days during the month of May as a result of major flooding in Central Oklahoma. The shutdown adversely affected throughput on the pipeline during May of approximately 285,000 barrels per day that month, but we made up much of those shipments in June, approximately 338,000 barrels per day in June and expect to make up the remainder in July with estimated throughput of approximately 374,000 barrels per day for the month, and that was July again. In addition, preliminary nominations for August came in at approximately 370,000 per day.
The Gathering, Processing and Terminalling segment generated adjusted EBITDA of $24 million for the second quarter, which was $4 million lower than the first quarter, and that is primarily as a result of the annual planned Casper and Douglas plant turnarounds.
Now moving on to the capital structure overview. At the end of the second quarter our leverage was approximately 3.6 times based on the trailing 12-month adjust EBITDA as calculated according to our credit agreements. When including our 75% share of REX's just over $2 billion in debt, our consolidated leverage for the quarter would have been approximately 4.7 times, again on a debt to EBITDA basis.
As expected, both figures are down from the first quarter due to continued EBITDA growth and as for liquidity today we have undrawn revolver capacity of over $800 million representing continued ample liquidity for funding our organic growth projects in additional bolt-on acquisitions.
With that, I'll turn it over to Bill now for commercial updates.
William R. Moler
Thank you, Gary. As Dave mentioned at the outset, our commercial teams continue to work tirelessly to re-contract existing assets and commercialize our new projects. Our operational teams have also done an outstanding job recently and through the quarter of integrating acquisitions and commissioning organic growth projects. In the gas transportation segment, REX west end volumes returned to near normal levels with quarter two average throughput of approximately 1.4 billion cubic feet per day. We believe these increased volumes are a result of West Coast markets beginning to return to more normal conditions.
Since our first quarter earnings call in early May, many of you have asked about the status of the Cheyenne Connector and REX-Cheyenne hub expansion projects. We are still waiting on the 7C certificate from FERC and frankly thought that