National Fuel Gas Company (NYSE:NFG) Q3 2020 Earnings Conference Call - Final Transcript
Aug 07, 2020 • 11:00 am ET
Ladies and gentlemen, thank you for standing by and welcome to the Q3 2020 National Fuel Gas Company Earnings Conference Call [Operator Instructions]
I would now like to hand the conference over to your speaker today, Ken Webster, Director of Investor Relations. Please go ahead, sir.
Kenneth E. Webster
Thank you, Ian, and good morning. We appreciate you joining us on today's conference call for a discussion of last evening's earnings release. With us on the call, from National Fuel Gas Company are Dave Bauer, President and Chief Executive Officer; Karen Camiolo, Treasurer and Principal Financial Officer; and John McGinnis, President of Seneca Resources. At the end of the prepared remarks, we will open the discussion to questions. The third quarter fiscal 2020 earnings release and August Investor Presentation have been posted on our Investor Relations website. You may refer to these materials during today's call.
We would like to remind you that today's teleconference will contain forward-looking statements. While National Fuel's expectations, beliefs, and projections are made in good faith and are believed to have a reasonable basis, actual results may differ materially. These statements speak only as of the date on which they are made, and you may refer to last evening's earnings release for a listing of certain specific risk factors.
National Fuel will be participating in the Barclays Energy Conference in September. Please contact me or the conference planners to schedule a meeting with the management team.
With that, I'll turn it over to Dave Bauer.
David P. Bauer
Thanks Ken. Good morning, everyone. As with most oil and gas companies, lower commodity prices weighed on the third [Technical Issues] gathering business. However, the remainder of the system had a very solid third quarter with pipeline earnings up nearly 45% on the strength of Supply Corporation's recent rate settlement and stable utility earnings, in spite of the COVID pandemic. Also the quarter was another great example of the benefits of our integrated, diversified model where the earnings and cash flows of our regulated businesses provided a strong measure of stability against the more variable earnings of our E&P business.
Operationally, this was a really significant quarter for National Fuel, one in which we reached several important milestones that make us well positioned to deliver meaningful growth in the years to come. First and foremost, last week we closed on the acquisition of Shell's upstream and midstream properties in Appalachia. This is a terrific opportunity to check all the boxes we are looking for in an acquisition. From start to finish, it was the results of the exceptional work of dozens of employees across our ypstream and midstream operations. Hats off to the team on a job well done. The acquisition meaningfully increases our presence in Appalachia. In fact, earlier this week Seneca's gross natural gas production crossed the 1 Bcf per day threshold. This is a great milestone. And to put in perspective, in fiscal 2018, our average daily production was only about half of that.
With the added scale, we expect to