NGL Energy Partners LP (NYSE:NGL) Q1 2021 Earnings Conference Call - Final Transcript

that reflects the $11 million one-time hit that -- it doesn't look like you can get that one back. Is there anything else built into that range that we should be thinking about?

Thanks, James. So yes, it does include the onetime item in Crude. The other commentary I would add to that is that, when we put the guidance out initially in April and then reiterated at the end of May, there was an extremely steep contango, which continued through May. That obviously disappeared in June. We do not expect contango to come back during the second half of this year and into next year. So we've removed the expectations for any significant contango barrels being held, which will help from a working capital perspective to reduce working capital needs, but obviously has the impact of not generating that incremental EBITDA either. So we captured contango during the first quarter. When we gave our original guidance, we expected to capture some contango throughout the year. And at this point in time, we're not expecting that. Otherwise, no other real changes.

Yes. I would just add, it's -- we're really in this transition period. I mean if you're going to have significant contango, you're going to have low crude prices, which is certainly not good for future crude and water production. So we're in this period here of -- I think some of our peers talked about -- they -- over $40 is a good thing. You're not going to have contango. I think fiscal '20 or calendar '21 is close to $45. So this should lead to some rigs being put back into service, we think no later than the first calendar quarter of '21 and then maybe when we get some DUCs completed in the last half of this year. So rather have a higher crude price than the contango.

Yes. Understand. Okay. That's helpful. Thank you.

And your next question comes from the line of Patrick Fitzgerald from Baird. Please go ahead.

Yes. Thanks for taking the question. Is there any way you could help us with kind of -- it seems like the obvious question about the capital structure with the maturities in '21. What's your plan to refinance that?

I'll start. This is Trey. So our 2021 maturity is our credit facility. It's -- so it's October of 2021. Our expectation is to have that extended prior to it going current. So that's something that we've been working on. We've been in communications with our bank group. We expect the bank group to be constructive. There are a couple unknowns that we've been working through, including we did the refi of a term loan. We completed that with Apollo back in June, so that we needed to complete that. And then the recent bankruptcy filing, we've been working through that as well. So this is something that is the number one priority of the finance team. Expect it to be extended. That's something that we're