HOUSTON,– Oasis Midstream Partners LP (Nasdaq: OMP) (the “Partnership” or “OMP”) today announced financial results for the quarter and year ended December 31, 2019 and updated its 2020 outlook.
2019 Highlights:
(1) Recast for assignment of Delaware Basin assets to Panther DevCo LLC (“Panther DevCo”) for the transfer of net assets between entities under common control in accordance with GAAP.
(2) Excludes $9.4 million of capital expenditures incurred in 2018 which were reimbursed to Oasis Petroleum in 4Q19 as part of the assignment of Delaware Basin assets to Panther DevCo. Delaware Basin capital expenditures incurred in 2018 were recast to the 2018 consolidated financial statements in accordance with GAAP.
“Fourth quarter results exceeded expectations for both operating and financial performance,” said Taylor Reid, Chief Executive Officer of OMP. “It’s been over a year since we commissioned our second gas plant at the Wild Basin complex and progress has been substantial. The gas processing complex ran at a high utilization in the fourth quarter and third-party volumes averaged over 30% of throughput. This strong performance along with continued success across water and oil led OMP to exceed EBITDA expectations, as well as coverage expectations. OMP is now operating in both the Williston and Delaware Basins, where we continue to benefit from our relationships with our anchor tenant, Oasis, and numerous third parties across both positions. The team looks forward to capitalizing on the diversified asset base across two top oil plays in the U.S. and across numerous commodity streams, while delivering additional value to our unitholders.”
2020 Capital Spending and Outlook:
The following table depicts our full-year 2020 guidance for capital expenditures (“CapEx”):
2020 CapEx |
||||||
DevCo |
OMP Ownership |
Gross |
Net |
|||
(In millions) |
||||||
Bighorn DevCo |
100% |
$7 – 9 |
$7 – 9 |
|||
Bobcat DevCo |
35.3% |
62 – 66 |
22 – 24 |
|||
Beartooth DevCo |
70% |
7 – 9 |
5 – 6 |
|||
Total Williston CapEx |
76 – 84 |
34 – 39 |
||||
Panther DevCo |
100% |
34 – 36 |
34 – 36 |
|||
Total CapEx |
$110 – 120 |
$68 – 75 |
2020 highlights include:
Throughput Volumes:
The following table shows gross volumes for 4Q19 compared to guidance, as well as volumes guidance for 1Q20 and full-year 2020.
Metric |
4Q19 |
4Q19 |
1Q20 |
FY20 |
||||||||
Bighorn DevCo |
||||||||||||
Crude oil service volumes |
Mbopd |
47.5 |
39 – 44 |
40 – 44 |
43 – 47 |
|||||||
Natural gas service volumes |
MMscfpd |
254.9 |
240 – 250 |
225 – 230 |
240 – 245 |
|||||||
Bobcat DevCo |
||||||||||||
Crude oil service volumes |
Mbopd |
36.1 |
34 – 36 |
31 – 33 |
36 – 38 |
|||||||
Natural gas service volumes |
MMscfpd |
302.1 |
280 – 295 |
250 – 260 |
275 – 285 |
|||||||
Water service volumes |
Mbwpd |
55.4 |
48 – 50 |
51 – 54 |
49 – 52 |
|||||||
Beartooth DevCo |
||||||||||||
Water service volumes |
Mbwpd |
125.4 |
120 – 140 |
120 – 130 |
100 – 110 |
Operational and Financial Update
Select financial statistics are presented in the following table for the periods presented:
Three Months Ended |
Year Ended |
||||||||||||||||
OMP |
Gross |
Net |
Gross |
Net |
|||||||||||||
(In millions) |
|||||||||||||||||
Bighorn DevCo |
|||||||||||||||||
Operating income |
100% |
$ |
21.8 |
$ |
21.8 |
$ |
62.7 |
$ |
62.7 |
||||||||
Depreciation and amortization |
100% |
3.2 |
3.2 |
13.0 |
13.0 |
||||||||||||
Bobcat DevCo |
|||||||||||||||||
Operating income |
35.3% |
$ |
31.2 |
$ |
10.8 |
$ |
110.6 |
$ |
34.4 |
||||||||
Depreciation and amortization |
35.3% |
3.5 |
1.2 |
13.2 |
4.1 |
||||||||||||
Beartooth DevCo |
|||||||||||||||||
Operating income |
70% |
$ |
14.1 |
$ |
9.8 |
$ |
56.6 |
$ |
39.6 |
||||||||
Depreciation and amortization |
70% |
2.4 |
1.7 |
9.4 |
6.6 |
||||||||||||
Panther DevCo |
|||||||||||||||||
Operating income |
100% |
$ |
1.3 |
$ |
1.3 |
$ |
5.8 |
$ |
5.8 |
||||||||
Depreciation and amortization |
100% |
0.3 |
0.3 |
0.7 |
0.7 |
||||||||||||
Total OMP |
|||||||||||||||||
DevCo operating income |
$ |
68.3 |
$ |
43.7 |
$ |
235.6 |
$ |
138.0 |
|||||||||
Public company expenses |
0.3 |
0.3 |
2.9 |
2.9 |
|||||||||||||
OMP operating income |
68.1 |
43.5 |
232.8 |
135.1 |
___________________ |
(1) OMP ownership interest as of December 31, 2019. |
Liquidity and Capital Expenditures
As of December 31, 2019, OMP had cash and cash equivalents of $4.2 million and $458.5 million of borrowings outstanding under its revolving credit facility with an unused borrowing capacity of $114.8 million. OMP has the flexibility to expand the aggregate commitment amount under its revolving credit facility from $575.0 million to $775.0 million, subject to certain conditions.
The following tables depict the Partnership’s CapEx for the periods presented:
1Q 2019 – 3Q 2019 |
4Q 2019 |
Year Ended December 31, 2019 |
|||||||||||||||||||||
(In millions) |
|||||||||||||||||||||||
Capital expenditures |
Gross |
Net |
Gross |
Net |
Gross |
Net |
|||||||||||||||||
Maintenance CapEx |
$ |
14.3 |
$ |
6.6 |
$ |
3.3 |
$ |
1.8 |
$ |
17.6 |
$ |
8.4 |
|||||||||||
Expansion CapEx |
162.0 |
156.9 |
32.4 |
32.4 |
194.4 |
189.3 |
|||||||||||||||||
Capitalized interest |
0.6 |
0.6 |
0.3 |
0.3 |
0.9 |
0.9 |
|||||||||||||||||
Total(1) |
$ |
176.9 |
$ |
164.1 |
$ |
36.0 |
$ |
34.5 |
$ |
212.9 |
$ |
198.6 |
___________________ |
(1) Retrospectively adjusted for transfer of net assets between entities under common control in accordance with GAAP. Excludes $9.4 million of capital expenditures incurred in 2018 which were reimbursed to Oasis Petroleum in 4Q19 as part of the assignment of Delaware Basin assets to Panther DevCo. Delaware Basin capital expenditures incurred in 2018 were recast to the 2018 consolidated financial statements in accordance with GAAP. |
Year Ended December 31, 2019 |
|||||||||
(In millions) |
|||||||||
DevCo |
OMP Ownership |
Gross |
Net |
||||||
Bighorn DevCo |
100% |
$ |
17.9 |
$ |
17.9 |
||||
Bobcat DevCo |
35.3% |
134.5 |
126.1 |
||||||
Beartooth DevCo |
70% |
19.6 |
13.7 |
||||||
Panther DevCo(1) |
100% |
40.0 |
40.0 |
||||||
OMP Operating(2) |
100% |
0.9 |
0.9 |
||||||
Total |
$ |
212.9 |
$ |
198.6 |
___________________ |
(1) Retrospectively adjusted for transfer of net assets between entities under common control in accordance with GAAP. Excludes $9.4 million of capital expenditures incurred in 2018 which were reimbursed to Oasis Petroleum in 4Q19 as part of the assignment of Delaware Basin assets to Panther DevCo. Delaware Basin capital expenditures incurred in 2018 were recast to the 2018 consolidated financial statements in accordance with GAAP. |
(2) Amounts represent capitalized interest related to borrowings under the OMP revolving credit facility. |
Quarterly Distribution
On January 30, 2020, the Board of Directors of the General Partner declared the quarterly distribution for 4Q19 of $0.54 per unit. In addition, the General Partner will receive a cash distribution of $1.0 million attributable to its incentive distribution rights related to earnings for 4Q19. These distributions will be paid on February 27, 2020 to unitholders of record as of February 13, 2020.
Qualified Notice
This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat one hundred percent (100.0%) of the Partnership’s distributions to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, the Partnership’s distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate.
Conference Call Information
Investors, analysts and other interested parties are invited to listen to the webcast and call:
Date: |
Wednesday, February 26, 2020 |
|
Time: |
11:30 a.m. Central Time |
|
Live Webcast: |
https://www.webcaster4.com/Webcast/Page/1777/32924 |
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Website: |
www.oasismidstream.com |
Sell-side analysts with a question may use the following dial-in:
Dial-in: |
888-317-6003 |
|
Intl. Dial in: |
412-317-6061 |
|
Conference ID: |
7445441 |
A recording of the conference call will be available beginning at 1:30 p.m. Central Time on the day of the call and will be available until Wednesday, March 4, 2020 by dialing:
Replay dial-in: |
877-344-7529 |
|
Intl. replay: |
412-317-0088 |
|
Replay code: |
10138756 |
The conference call will also be available for replay for approximately 30 days at www.oasismidstream.com.
Contact:
Oasis Midstream Partners LP
Bob Bakanauskas, (281) 404-9600
Director, Investor Relations
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Partnership, including the Partnership’s capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Partnership based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Partnership, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, the Partnership’s ability to integrate acquisitions into its existing business, changes in crude oil and natural gas prices, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in the estimates of proved reserves and forecasted production results of the Partnership’s customers, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Partnership’s ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Partnership’s business and other important factors. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the Partnership’s actual results and plans could differ materially from those expressed in any forward-looking statements.
Any forward-looking statement speaks only as of the date on which such statement is made and the Partnership undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
About Oasis Midstream Partners LP
Oasis Midstream Partners LP is a growth-oriented, fee-based master limited partnership formed by its sponsor, Oasis Petroleum Inc. to own, develop, operate and acquire a diversified portfolio of midstream assets in North America that are integral to the crude oil and natural gas operations of Oasis Petroleum Inc. and are strategically positioned to capture volumes from other producers. For more information, please visit the Partnership’s website at www.oasismidstream.com.